small business reauthorization act of … business reauthorization act of 1997. dec. 2, 1997 [s....

PUBLIC LAW 105–135—DEC. 2, 1997

SMALL BUSINESS REAUTHORIZATIONACT OF 1997

111 STAT. 2592 PUBLIC LAW 105–135—DEC. 2, 1997

Public Law 105–135105th Congress

An ActTo reauthorize the programs of the Small Business Administration, and for other

purposes.

Be it enacted by the Senate and House of Representatives ofthe United States of America in Congress assembled,SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Small BusinessReauthorization Act of 1997’’.

(b) TABLE OF CONTENTS.—The table of contents for this Actis as follows:

Sec. 1. Short title; table of contents.Sec. 2. Definitions.Sec. 3. Effective date.

TITLE I—AUTHORIZATIONSSec. 101. Authorizations.

TITLE II—FINANCIAL ASSISTANCE

Subtitle A—Microloan ProgramSec. 201. Microloan program.Sec. 202. Welfare-to-work microloan initiative.

Subtitle B—Small Business Investment Company ProgramSec. 211. 5-year commitments for SBICs at option of Administrator.Sec. 212. Underserved areas.Sec. 213. Private capital.Sec. 214. Fees.Sec. 215. Small business investment company program reform.Sec. 216. Examination fees.

Subtitle C—Certified Development Company ProgramSec. 221. Loans for plant acquisition, construction, conversion, and expansion.Sec. 222. Development company debentures.Sec. 223. Premier certified lenders program.

Subtitle D—Miscellaneous ProvisionsSec. 231. Background check of loan applicants.Sec. 232. Report on increased lender approval, servicing, foreclosure, liquidation,

and litigation of section 7(a) loans.Sec. 233. Completion of planning for loan monitoring system.

TITLE III—WOMEN’S BUSINESS ENTERPRISESSec. 301. Interagency committee participation.Sec. 302. Reports.Sec. 303. Council duties.Sec. 304. Council membership.Sec. 305. Authorization of appropriations.Sec. 306. National Women’s Business Council procurement project.Sec. 307. Studies and other research.

15 USC 631 note.

Small BusinessReauthorizationAct of 1997.

Dec. 2, 1997[S. 1139]

111 STAT. 2593PUBLIC LAW 105–135—DEC. 2, 1997

Sec. 308. Women’s business centers.

TITLE IV—COMPETITIVENESS PROGRAM AND PROCUREMENTOPPORTUNITIES

Subtitle A—Small Business Competitiveness ProgramSec. 401. Program term.Sec. 402. Monitoring agency performance.Sec. 403. Reports to Congress.Sec. 404. Small business participation in dredging.Sec. 405. Technical amendments.

Subtitle B—Small Business Procurement Opportunities ProgramSec. 411. Contract bundling.Sec. 412. Definition of contract bundling.Sec. 413. Assessing proposed contract bundling.Sec. 414. Reporting of bundled contract opportunities.Sec. 415. Evaluating subcontract participation in awarding contracts.Sec. 416. Improved notice of subcontracting opportunities.Sec. 417. Deadlines for issuance of regulations.

TITLE V—MISCELLANEOUS PROVISIONSSec. 501. Small Business Technology Transfer program.Sec. 502. Small Business Development Centers.Sec. 503. Pilot preferred surety bond guarantee program extension.Sec. 504. Extension of cosponsorship authority.Sec. 505. Asset sales.Sec. 506. Small business export promotion.Sec. 507. Defense Loan and Technical Assistance program.Sec. 508. Very small business concerns.Sec. 509. Trade assistance program for small business concerns adversely affected

by NAFTA.

TITLE VI—HUBZONE PROGRAMSec. 601. Short title.Sec. 602. Historically underutilized business zones.Sec. 603. Technical and conforming amendments to the Small Business Act.Sec. 604. Other technical and conforming amendments.Sec. 605. Regulations.Sec. 606. Report.Sec. 607. Authorization of appropriations.

TITLE VII—SERVICE DISABLED VETERANSSec. 701. Purposes.Sec. 702. Definitions.Sec. 703. Report by Small Business Administration.Sec. 704. Information collection.Sec. 705. State of small business report.Sec. 706. Loans to veterans.Sec. 707. Entrepreneurial training, counseling, and management assistance.Sec. 708. Grants for eligible veterans’ outreach programs.Sec. 709. Outreach for eligible veterans.

SEC. 2. DEFINITIONS.

In this Act—(1) the term ‘‘Administration’’ means the Small Business

Administration;(2) the term ‘‘Administrator’’ means the Administrator of

the Small Business Administration;(3) the term ‘‘Committees’’ means the Committees on Small

Business of the House of Representatives and the Senate; and(4) the term ‘‘small business concern’’ has the meaning

given the term in section 3 of the Small Business Act (15U.S.C. 632).

SEC. 3. EFFECTIVE DATE.

This Act and the amendments made by this Act shall takeeffect on October 1, 1997.

15 USC 631 note.

15 USC 631 note.


TITLE I—AUTHORIZATIONS

SEC. 101. AUTHORIZATIONS.

Section 20 of the Small Business Act (15 U.S.C. 631 note)is amended by striking subsections (c) through (q) and insertingthe following:

‘‘(c) FISCAL YEAR 1998.—‘‘(1) PROGRAM LEVELS.—The following program levels are

authorized for fiscal year 1998:‘‘(A) For the programs authorized by this Act, the

Administration is authorized to make—‘‘(i) $40,000,000 in technical assistance grants, as

provided in section 7(m); and‘‘(ii) $60,000,000 in direct loans, as provided in

section 7(m).‘‘(B) For the programs authorized by this Act, the

Administration is authorized to make $16,040,000,000 indeferred participation loans and other financings. Of suchsum, the Administration is authorized to make—

‘‘(i) $12,000,000,000 in general business loans asprovided in section 7(a);

‘‘(ii) $3,000,000,000 in financings as provided insection 7(a)(13) of this Act and section 504 of theSmall Business Investment Act of 1958;

‘‘(iii) $1,000,000,000 in loans as provided in section7(a)(21); and

‘‘(iv) $40,000,000 in loans as provided in section7(m).‘‘(C) For the programs authorized by title III of the

Small Business Investment Act of 1958, the Administrationis authorized to make—

‘‘(i) $700,000,000 in purchases of participatingsecurities; and

‘‘(ii) $600,000,000 in guarantees of debentures.‘‘(D) For the programs authorized by part B of title

IV of the Small Business Investment Act of 1958, theAdministration is authorized to enter into guarantees notto exceed $2,000,000,000, of which not more than$650,000,000 may be in bonds approved pursuant to section411(a)(3) of that Act.

‘‘(E) The Administration is authorized to make grantsor enter into cooperative agreements—

‘‘(i) for the Service Corps of Retired Executivesprogram authorized by section 8(b)(1), $4,000,000; and

‘‘(ii) for activities of small business developmentcenters pursuant to section 21(c)(3)(G), $15,000,000,to remain available until expended.

‘‘(2) ADDITIONAL AUTHORIZATIONS.—‘‘(A) There are authorized to be appropriated to the

Administration for fiscal year 1998 such sums as maybe necessary to carry out this Act, including administrativeexpenses and necessary loan capital for disaster loanspursuant to section 7(b), and to carry out the Small Busi-ness Investment Act of 1958, including salaries andexpenses of the Administration.


‘‘(B) Notwithstanding subparagraph (A), for fiscal year1998—

‘‘(i) no funds are authorized to be provided to carryout the loan program authorized by section 7(a)(21)except by transfer from another Federal departmentor agency to the Administration, unless the programlevel authorized for general business loans under para-graph (1)(B)(i) is fully funded; and

‘‘(ii) the Administration may not approve loanson behalf of the Administration or on behalf of anyother department or agency, by contract or otherwise,under terms and conditions other than those specifi-cally authorized under this Act or the Small BusinessInvestment Act of 1958, except that it may approveloans under section 7(a)(21) of this Act in grossamounts of not more than $1,250,000.

‘‘(d) FISCAL YEAR 1999.—‘‘(1) PROGRAM LEVELS.—The following program levels are


Administration is authorized to make—‘‘(i) $40,000,000 in technical assistance grants as











IV of the Small Business Investment Act of 1958, theAdministration is authorized to enter into guarantees notto exceed $2,000,000,000, of which not more than$650,000,000 may be in bonds approved pursuant to section411(a)(3) of that Act.

‘‘(E) The Administration is authorized to make grantsor enter cooperative agreements—


‘‘(ii) for activities of small business developmentcenters pursuant to section 21(c)(3)(G), not to exceed$15,000,000, to remain available until expended.






‘‘(ii) the Administration may not approve loanson behalf of the Administration or on behalf of anyother department or agency, by contract or otherwise,under terms and conditions other than those specifi-cally authorized under this Act or the Small BusinessInvestment Act of 1958, except that it may approveloans under section 7(a)(21) of this Act in grossamounts of not more than $1,250,000.

‘‘(e) FISCAL YEAR 2000.—‘‘(1) PROGRAM LEVELS.—The following program levels are


Administration is authorized to make—‘‘(i) $40,000,000 in technical assistance grants as











IV of the Small Business Investment Act of 1958, theAdministration is authorized to enter into guarantees notto exceed $2,000,000,000, of which not more than


$650,000,000 may be in bonds approved pursuant to section411(a)(3) of that Act.

‘‘(E) The Administration is authorized to make grantsor enter cooperative agreements—


‘‘(ii) for activities of small business developmentcenters pursuant to section 21(c)(3)(G), not to exceed$15,000,000, to remain available until expended.





‘‘(ii) the Administration may not approve loanson behalf of the Administration or on behalf of anyother department or agency, by contract or otherwise,under terms and conditions other than those specifi-cally authorized under this Act or the Small BusinessInvestment Act of 1958, except that it may approveloans under section 7(a)(21) of this Act in grossamounts of not more than $1,250,000.’’.

TITLE II—FINANCIAL ASSISTANCE

Subtitle A—Microloan Program

SEC. 201. MICROLOAN PROGRAM.

(a) LOAN LIMITS.—Section 7(m)(3)(C) of the Small BusinessAct (15 U.S.C. 636(m)(3)(C)) is amended by striking ‘‘$2,500,000’’and inserting ‘‘$3,500,000’’.

(b) LOAN LOSS RESERVE FUND.—Section 7(m)(3)(D) of the SmallBusiness Act (15 U.S.C. 636(m)(3)(D)) is amended by strikingclauses (i) and (ii), and inserting the following:

‘‘(i) during the initial 5 years of the intermediary’sparticipation in the program under this subsection,at a level equal to not more than 15 percent of theoutstanding balance of the notes receivable owed tothe intermediary; and

‘‘(ii) in each year of participation thereafter, ata level equal to not more than the greater of—


‘‘(I) 2 times an amount reflecting the totallosses of the intermediary as a result of participa-tion in the program under this subsection, as deter-mined by the Administrator on a case-by-casebasis; or

‘‘(II) 10 percent of the outstanding balanceof the notes receivable owed to the intermediary.’’.

(c) AUTHORIZATION OF APPROPRIATIONS.—Section 7(m) of theSmall Business Act (15 U.S.C. 636(m)) is amended—

(1) in the subsection heading, by striking ‘‘DEMONSTRA-TION’’;

(2) by striking ‘‘Demonstration’’ each place that termappears;

(3) by striking ‘‘demonstration’’ each place that termappears; and

(4) in paragraph (12), by striking ‘‘during fiscal years 1995through 1997’’ and inserting ‘‘during fiscal years 1998 through2000’’.(d) TECHNICAL ASSISTANCE GRANTS.—Section 7(m) of the Small

Business Act (15 U.S.C. 636(m)) is amended—(1) in paragraph (4)(E)—

(A) by striking ‘‘Each intermediary’’ and inserting thefollowing:

‘‘(i) IN GENERAL.—Each intermediary’’;(B) by striking ‘‘15’’ and inserting ‘‘25’’; and(C) by adding at the end the following:

‘‘(ii) TECHNICAL ASSISTANCE.—An intermediarymay expend not more than 25 percent of the fundsreceived under paragraph (1)(B)(ii) to enter into thirdparty contracts for the provision of technical assist-ance.’’; and

(2) in paragraph (5)(A)—(A) by striking ‘‘in each of the 5 years of the demonstra-

tion program established under this subsection,’’; and(B) by striking ‘‘for terms of up to 5 years’’ and insert-

ing ‘‘annually’’.

SEC. 202. WELFARE-TO-WORK MICROLOAN INITIATIVE.

(a) INITIATIVE.—Section 7(m) of the Small Business Act (15U.S.C. 636(m)) is amended—

(1) in paragraph (1)(A)—(A) in clause (ii), by striking ‘‘and’’ at the end;(B) in clause (iii), by striking the period at the end

and inserting ‘‘; and’’; and(C) by adding at the end the following:‘‘(iv) to establish a welfare-to-work microloan initiative,

which shall be administered by the Administration, in orderto test the feasibility of supplementing the technical assist-ance grants provided under clauses (ii) and (iii) of subpara-graph (B) to individuals who are receiving assistance underthe State program funded under part A of title IV ofthe Social Security Act (42 U.S.C. 601 et seq.), or underany comparable State funded means tested program ofassistance for low-income individuals, in order to ade-quately assist those individuals in—

‘‘(I) establishing small businesses; and


‘‘(II) eliminating their dependence on that assist-ance.’’;

(2) in paragraph (4), by adding at the end the following:‘‘(F) SUPPLEMENTAL GRANT.—

‘‘(i) IN GENERAL.—The Administration may acceptany funds transferred to the Administration from otherdepartments or agencies of the Federal Governmentto make grants in accordance with this subparagraphand section 202(b) of the Small Business Reauthoriza-tion Act of 1997 to participating intermediaries andtechnical assistance providers under paragraph (5), foruse in accordance with clause (iii) to provide additionaltechnical assistance and related services to recipientsof assistance under a State program described in para-graph (1)(A)(iv) at the time they initially apply forassistance under this subparagraph.

‘‘(ii) ELIGIBLE RECIPIENTS; GRANT AMOUNTS.—Inmaking grants under this subparagraph, the Adminis-tration may select, from among participating inter-mediaries and technical assistance providers describedin clause (i), not more than 20 grantees in fiscal year1998, not more than 25 grantees in fiscal year 1999,and not more than 30 grantees in fiscal year 2000,each of whom may receive a grant under this subpara-graph in an amount not to exceed $200,000 per year.

‘‘(iii) USE OF GRANT AMOUNTS.—Grants under thissubparagraph—

‘‘(I) are in addition to other grants providedunder this subsection and shall not require thecontribution of matching amounts as a conditionof eligibility; and

‘‘(II) may be used by a grantee—‘‘(aa) to pay or reimburse a portion of child

care and transportation costs of recipients ofassistance described in clause (i), to the extentsuch costs are not otherwise paid by Stateblock grants under the Child Care Develop-ment Block Grant Act of 1990 (42 U.S.C. 9858et seq.) or under part A of title IV of theSocial Security Act (42 U.S.C. 601 et seq.);and

‘‘(bb) for marketing, management, andtechnical assistance to recipients of assistancedescribed in clause (i).

‘‘(iv) MEMORANDUM OF UNDERSTANDING.—Prior toaccepting any transfer of funds under clause (i) froma department or agency of the Federal Government,the Administration shall enter into a Memorandumof Understanding with the department or agency,which shall—

‘‘(I) specify the terms and conditions of thegrants under this subparagraph; and

‘‘(II) provide for appropriate monitoring ofexpenditures by each grantee under this subpara-graph and each recipient of assistance describedin clause (i) who receives assistance from a grantee


under this subparagraph, in order to ensurecompliance with this subparagraph by thosegrantees and recipients of assistance.’’;

(3) in paragraph (6), by adding at the end the following:‘‘(E) ESTABLISHMENT OF CHILD CARE OR TRANSPOR-

TATION BUSINESSES.—In addition to other eligible smallbusinesses concerns, borrowers under any program underthis subsection may include individuals who will use theloan proceeds to establish for-profit or nonprofit child careestablishments or businesses providing for-profit transpor-tation services.’’;(4) in paragraph (9)—

(A) by striking the paragraph designation and para-graph heading and inserting the following:‘‘(9) GRANTS FOR MANAGEMENT, MARKETING, TECHNICAL

ASSISTANCE, AND RELATED SERVICES.—’’; and(B) by adding at the end the following:‘‘(C) WELFARE-TO-WORK MICROLOAN INITIATIVE.—Of

amounts made available to carry out the welfare-to-workmicroloan initiative under paragraph (1)(A)(iv) in any fiscalyear, the Administration may use not more than 5 percentto provide technical assistance, either directly or throughcontractors, to welfare-to-work microloan initiativegrantees, to ensure that, as grantees, they have the knowl-edge, skills, and understanding of microlending and wel-fare-to-work transition, and other related issues, to operatea successful welfare-to-work microloan initiative.’’; and(5) by adding at the end the following:‘‘(13) EVALUATION OF WELFARE-TO-WORK MICROLOAN INITIA-

TIVE.—On January 31, 1999, and annually thereafter, theAdministration shall submit to the Committees on Small Busi-ness of the House of Representatives and the Senate a reporton any monies distributed pursuant to paragraph (4)(F).’’.(b) TRANSFER OF FUNDS.—

(1) IN GENERAL.—No funds are authorized to be appro-priated or otherwise provided to carry out the grant programunder section 7(m)(4)(F) of the Small Business Act (15 U.S.C.636(m)(4)(F)) (as added by this section), except by transferfrom another department or agency of the Federal Governmentto the Administration in accordance with this subsection.

(2) LIMITATION ON AMOUNTS.—The total amount transferredto the Administration from other departments and agenciesof the Federal Government to carry out the grant programunder section 7(m)(4)(F) of the Small Business Act (15 U.S.C.636(m)(4)(F)) (as added by this section) shall not exceed—

(A) $3,000,000 for fiscal year 1998;(B) $4,000,000 for fiscal year 1999; and(C) $5,000,000 for fiscal year 2000.

Subtitle B—Small Business InvestmentCompany Program

SEC. 211. 5-YEAR COMMITMENTS FOR SBICs AT OPTION OF ADMINIS-TRATOR.

Section 20(a)(2) of the Small Business Act (15 U.S.C. 631 note)is amended in the last sentence by striking ‘‘the following fiscal

15 USC 636 note.

Reports.


year’’ and inserting ‘‘any 1 or more of the 4 subsequent fiscalyears’’.SEC. 212. UNDERSERVED AREAS.

Section 301(c)(4)(B) of the Small Business Investment Act of1958 (15 U.S.C. 681(c)(4)(B)) is amended to read as follows:

‘‘(B) LEVERAGE.—An applicant licensed pursuant to theexception provided in this paragraph shall not be eligibleto receive leverage as a licensee until the applicant satisfiesthe requirements of section 302(a), unless the applicant—

‘‘(i) files an application for a license not later than180 days after the date of enactment of the SmallBusiness Reauthorization Act of 1997;

‘‘(ii) is located in a State that is not served bya licensee; and

‘‘(iii) agrees to be limited to 1 tier of leverageavailable under section 302(b), until the applicantmeets the requirements of section 302(a).’’.

SEC. 213. PRIVATE CAPITAL.

Section 103(9)(B)(iii) of the Small Business Investment Actof 1958 (15 U.S.C. 662(9)(B)(iii)) is amended—

(1) by redesignating subclauses (I) and (II) as subclauses(II) and (III), respectively; and

(2) by inserting before subclause (II) (as redesignated) thefollowing:

‘‘(I) funds obtained from the business revenues(excluding any governmental appropriation) of anyfederally chartered or government-sponsored cor-poration established prior to October 1, 1987;’’.

SEC. 214. FEES.

Section 301 of the Small Business Investment Act of 1958(15 U.S.C. 681) is amended by adding at the end the following:

‘‘(e) FEES.—‘‘(1) IN GENERAL.—The Administration may prescribe fees

to be paid by each applicant for a license to operate as asmall business investment company under this Act.

‘‘(2) USE OF AMOUNTS.—Fees collected under this sub-section—

‘‘(A) shall be deposited in the account for salaries andexpenses of the Administration; and

‘‘(B) are authorized to be appropriated solely to coverthe costs of licensing examinations.’’.

SEC. 215. SMALL BUSINESS INVESTMENT COMPANY PROGRAMREFORM.

(a) BANK INVESTMENTS.—Section 302(b) of the Small BusinessInvestment Act of 1958 (15 U.S.C. 682(b)) is amended by striking‘‘1956,’’ and all that follows before the period and inserting thefollowing: ‘‘1956, any national bank, or any member bank of theFederal Reserve System or nonmember insured bank to the extentpermitted under applicable State law, may invest in any 1 ormore small business investment companies, or in any entity estab-lished to invest solely in small business investment companies,except that in no event shall the total amount of such investmentsof any such bank exceed 5 percent of the capital and surplusof the bank’’.


(b) INDEXING FOR LEVERAGE.—Section 303 of the Small Busi-ness Investment Act of 1958 (15 U.S.C. 683) is amended—

(1) in subsection (b)—(A) in paragraph (2), by adding at the end the following:‘‘(D)(i) The dollar amounts in subparagraphs (A), (B),

and (C) shall be adjusted annually to reflect increasesin the Consumer Price Index established by the Bureauof Labor Statistics of the Department of Labor.

‘‘(ii) The initial adjustments made under this subpara-graph after the date of enactment of the Small BusinessReauthorization Act of 1997 shall reflect only increasesfrom March 31, 1993.’’; and

(B) by striking paragraph (4) and inserting the follow-ing:‘‘(4) MAXIMUM AGGREGATE AMOUNT OF LEVERAGE.—

‘‘(A) IN GENERAL.—Except as provided in subparagraph(B), the aggregate amount of outstanding leverage issuedto any company or companies that are commonly controlled(as determined by the Administrator) may not exceed$90,000,000, as adjusted annually for increases in the Con-sumer Price Index.

‘‘(B) EXCEPTIONS.—The Administrator may, on a case-by-case basis—

‘‘(i) approve an amount of leverage that exceedsthe amount described in subparagraph (A) for compa-nies under common control; and

‘‘(ii) impose such additional terms and conditionsas the Administrator determines to be appropriate tominimize the risk of loss to the Administration inthe event of default.‘‘(C) APPLICABILITY OF OTHER PROVISIONS.—Any lever-

age that is issued to a company or companies commonlycontrolled in an amount that exceeds $90,000,000, whetheras a result of an increase in the Consumer Price Indexor a decision of the Administrator, is subject to subsection(d).’’; and(2) by striking subsection (d) and inserting the following:

‘‘(d) REQUIRED CERTIFICATIONS.—‘‘(1) IN GENERAL.—The Administrator shall require each

licensee, as a condition of approval of an application for lever-age, to certify in writing—

‘‘(A) for licensees with leverage less than or equalto $90,000,000, that not less than 20 percent of the licens-ee’s aggregate dollar amount of financings will be providedto smaller enterprises; and

‘‘(B) for licensees with leverage in excess of$90,000,000, that, in addition to satisfying the require-ments of subparagraph (A), 100 percent of the licensee’saggregate dollar amount of financings made in whole orin part with leverage in excess of $90,000,000 will beprovided to smaller enterprises (as defined in section103(12)).‘‘(2) MULTIPLE LICENSEES.—Multiple licensees under com-

mon control (as determined by the Administrator) shall beconsidered to be a single licensee for purposes of determiningboth the applicability of and compliance with the investmentpercentage requirements of this subsection.’’.


(c) TAX DISTRIBUTIONS.—Section 303(g)(8) of the Small BusinessInvestment Act of 1958 (15 U.S.C. 683(g)(8)) is amended by addingat the end the following: ‘‘A company may also elect to makea distribution under this paragraph at the end of any calendarquarter based on a quarterly estimate of the maximum tax liability.If a company makes 1 or more quarterly distributions for a calendaryear, and the aggregate amount of those distributions exceeds themaximum amount that the company could have distributed basedon a single annual computation, any subsequent distribution bythe company under this paragraph shall be reduced by an amountequal to the excess amount distributed.’’.

(d) LEVERAGE FEE.—Section 303(i) of the Small Business Invest-ment Act of 1958 (15 U.S.C. 683(i)) is amended by striking‘‘, payable upon’’ and all that follows before the period and insertingthe following: ‘‘in the following manner: 1 percent upon the dateon which the Administration enters into any commitment for suchleverage with the licensee, and the balance of 2 percent (or 3percent if no commitment has been entered into by the Administra-tion) on the date on which the leverage is drawn by the licensee’’.

(e) PERIODIC ISSUANCE OF GUARANTEES AND TRUST CERTIFI-CATES.—Section 320 of the Small Business Investment Act of 1958(15 U.S.C. 687m) is amended by striking ‘‘three months’’ and insert-ing ‘‘6 months’’.SEC. 216. EXAMINATION FEES.

Section 310(b) of the Small Business Investment Act of 1958(15 U.S.C. 687b(b)) is amended by inserting after the first sentencethe following: ‘‘Fees collected under this subsection shall be depos-ited in the account for salaries and expenses of the Administration,and are authorized to be appropriated solely to cover the costsof examinations and other program oversight activities.’’.

Subtitle C—Certified DevelopmentCompany Program

SEC. 221. LOANS FOR PLANT ACQUISITION, CONSTRUCTION, CONVER-SION, AND EXPANSION.

Section 502 of the Small Business Investment Act of 1958(15 U.S.C. 696) is amended—

(1) by striking paragraph (1) and inserting the following:‘‘(1) USE OF PROCEEDS.—The proceeds of any such loan

shall be used solely by the borrower to assist 1 or more identifi-able small business concerns and for a sound business purposeapproved by the Administration.’’;

(2) in paragraph (3), by adding at the end the following:‘‘(D) SELLER FINANCING.—Seller-provided financing

may be used to meet the requirements of subparagraph(B), if the seller subordinates the interest of the sellerin the property to the debenture guaranteed by theAdministration.

‘‘(E) COLLATERALIZATION.—The collateral provided bythe small business concern shall generally include asubordinate lien position on the property being financedunder this title, and is only 1 of the factors to be evaluatedin the credit determination. Additional collateral shall berequired only if the Administration determines, on a case-


by-case basis, that additional security is necessary to pro-tect the interest of the Government.’’; and(3) by adding at the end the following:‘‘(5) LIMITATION ON LEASING.—In addition to any portion

of the project permitted to be leased under paragraph (4),not to exceed 20 percent of the project may be leased by theassisted small business to 1 or more other tenants, if theassisted small business occupies permanently and uses notless than a total of 60 percent of the space in the projectafter the execution of any leases authorized under this section.’’.

SEC. 222. DEVELOPMENT COMPANY DEBENTURES.

Section 503 of the Small Business Investment Act of 1958(15 U.S.C. 697) is amended—

(1) in subsection (b)(7), by striking subparagraph (A) andinserting the following:

‘‘(A) assesses and collects a fee, which shall be payableby the borrower, in an amount established annually bythe Administration, which amount shall not exceed thelesser of—

‘‘(i) 0.9375 percent per year of the outstandingbalance of the loan; and

‘‘(ii) the minimum amount necessary to reduce thecost (as defined in section 502 of the Federal CreditReform Act of 1990) to the Administration of purchas-ing and guaranteeing debentures under this Act tozero; and’’; and

(2) in subsection (f), by striking ‘‘1997’’ and inserting ‘‘2000’’.SEC. 223. PREMIER CERTIFIED LENDERS PROGRAM.

(a) IN GENERAL.—Section 508 of the Small Business InvestmentAct of 1958 (15 U.S.C. 697e) is amended—

(1) in subsection (a), by striking ‘‘not more than 15’’;(2) in subsection (b)—

(A) in paragraph (2)—(i) in the matter preceding subparagraph (A), by

striking ‘‘if such company’’;(ii) by striking subparagraphs (A) and (B) and

inserting the following:‘‘(A) if the company is an active certified development

company in good standing and has been an active partici-pant in the accredited lenders program during the entire12-month period preceding the date on which the companysubmits an application under paragraph (1), except thatthe Administration may waive this requirement if the com-pany is qualified to participate in the accredited lendersprogram;

‘‘(B) if the company has a history of—‘‘(i) submitting to the Administration adequately

analyzed debenture guarantee application packages;and

‘‘(ii) of properly closing section 504 loans and serv-icing its loan portfolio;’’;

(iii) in subparagraph (C)—(I) by inserting ‘‘if the company’’ after ‘‘(C)’’;

and(II) by striking the period at the end and

inserting ‘‘; and’’; and


(iv) by adding at the end the following:‘‘(D) the Administrator determines, with respect to the

company, that the loss reserve established in accordancewith subsection (c)(2) is sufficient for the company to meetits obligations to protect the Federal Government fromrisk of loss.’’; and

(B) by adding at the end the following:‘‘(3) APPLICABILITY OF CRITERIA AFTER DESIGNATION.—The

Administrator may revoke the designation of a certified develop-ment company as a premier certified lender under this sectionat any time, if the Administrator determines that the certifieddevelopment company does not meet any requirement describedin subparagraphs (A) through (D) of paragraph (2).’’;

(3) by striking subsection (c) and inserting the following:‘‘(c) LOSS RESERVE.—

‘‘(1) ESTABLISHMENT.—A company designated as a premiercertified lender shall establish a loss reserve for financingapproved pursuant to this section.

‘‘(2) AMOUNT.—The amount of each loss reserve establishedunder paragraph (1) shall be 10 percent of the amount ofthe company’s exposure, as determined under subsection(b)(2)(C).

‘‘(3) ASSETS.—Each loss reserve established under para-graph (1) shall be comprised of—

‘‘(A) segregated funds on deposit in an account oraccounts with a federally insured depository institutionor institutions selected by the company, subject to a collat-eral assignment in favor of, and in a format acceptableto, the Administration;

‘‘(B) irrevocable letter or letters of credit, with a collat-eral assignment in favor of, and a commercially reasonableformat acceptable to, the Administration; or

‘‘(C) any combination of the assets described in sub-paragraphs (A) and (B).‘‘(4) CONTRIBUTIONS.—The company shall make contribu-

tions to the loss reserve, either cash or letters of credit asprovided above, in the following amounts and at the followingintervals:

‘‘(A) 50 percent when a debenture is closed.‘‘(B) 25 percent additional not later than 1 year after

a debenture is closed.‘‘(C) 25 percent additional not later than 2 years after

a debenture is closed.‘‘(5) REPLENISHMENT.—If a loss has been sustained by the

Administration, any portion of the loss reserve, and other fundsprovided by the premier company as necessary, may be usedto reimburse the Administration for the premier company’s10 percent share of the loss as provided in subsection (b)(2)(C).If the company utilizes the reserve, within 30 days it shallreplace an equivalent amount of funds.

‘‘(6) DISBURSEMENTS.—The Administration shall allow thecertified development company to withdraw from the lossreserve amounts attributable to any debenture that has beenrepaid.’’;

(4) in subsection (d)(1), by striking ‘‘to approve loans’’ andinserting ‘‘to approve, authorize, close, service, foreclose, litigate(except that the Administration may monitor the conduct of


any such litigation to which a premier certified lender is aparty), and liquidate loans’’;

(5) in subsection (f), by striking ‘‘State or local’’ and insert-ing ‘‘certified’’;

(6) in subsection (g), by striking the subsection headingand inserting the following:‘‘(g) EFFECT OF SUSPENSION OR REVOCATION.—’’;

(7) by striking subsection (h) and inserting the following:‘‘(h) PROGRAM GOALS.—Each certified development company

participating in the program under this section shall establisha goal of processing a minimum of not less than 50 percent ofthe loan applications for assistance under section 504 pursuantto the program authorized under this section.’’; and

(8) in subsection (i), by striking ‘‘other lenders’’ and insert-ing ‘‘other lenders, specifically comparing default rates andrecovery rates on liquidations’’.(b) REGULATIONS.—The Administrator shall—

(1) not later than 150 days after the date of enactmentof this Act, promulgate regulations to carry out the amendmentsmade by subsection (a); and

(2) not later than 180 days after the date of enactmentof this Act, issue program guidelines and fully implement theamendments made by subsection (a).(c) PROGRAM EXTENSION.—Section 217(b) of the Small Business

Reauthorization and Amendments Act of 1994 (15 U.S.C. 697enote) is amended by striking ‘‘October 1, 1997’’ and inserting ‘‘Octo-ber 1, 2000’’.

Subtitle D—Miscellaneous Provisions

SEC. 231. BACKGROUND CHECK OF LOAN APPLICANTS.

Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) isamended—

(1) by striking ‘‘(a) The Administration’’ and inserting thefollowing:‘‘(a) LOANS TO SMALL BUSINESS CONCERNS; ALLOWABLE PUR-

POSES; QUALIFIED BUSINESS; RESTRICTIONS AND LIMITATIONS.—TheAdministration’’; and

(2) in paragraph (1)—(A) by striking ‘‘(1) No financial’’ and inserting the

following:‘‘(1) IN GENERAL.—

‘‘(A) CREDIT ELSEWHERE.—No financial’’; and(B) by adding at the end the following:‘‘(B) BACKGROUND CHECKS.—Prior to the approval of

any loan made pursuant to this subsection, or section 503of the Small Business Investment Act of 1958, the Adminis-trator may verify the applicant’s criminal background, orlack thereof, through the best available means, including,if possible, use of the National Crime Information Centercomputer system at the Federal Bureau of Investigation.’’.

SEC. 232. REPORT ON INCREASED LENDER APPROVAL, SERVICING,FORECLOSURE, LIQUIDATION, AND LITIGATION OF SEC-TION 7(a) LOANS.

(a) IN GENERAL.—


(1) SUBMISSION.—Not later than 6 months after the dateof enactment of this Act, the Administrator shall submit tothe Committees a report on action taken and planned for futurereliance on private sector lender resources to originate, approve,close, service, liquidate, foreclose, and litigate loans made undersection 7(a) of the Small Business Act.

(2) CONTENTS.—The report under this subsection shalladdress administrative and other steps necessary to achievethe results described in paragraph (1), including—

(A) streamlining the process for approving lenders andstandardizing requirements;

(B) establishing uniform reporting requirements usingon-line automated capabilities to the maximum extent fea-sible;

(C) reducing paperwork through automation, simplifiedforms, or incorporation of lender’s forms;

(D) providing uniform standards for approval, closing,servicing, foreclosure, and liquidation;

(E) promulgating new regulations or amending existingones;

(F) establishing a timetable for implementing the planfor reliance on private sector lenders;

(G) implementing organizational changes at SBA; and(H) estimating the annual savings that would occur

as a result of implementation.(b) CONSULTATION.—In preparing the report under subsection

(a), the Administrator shall consult with, among others—(1) borrowers and lenders under section 7(a) of the Small

Business Act;(2) small businesses that are potential program participants

under section 7(a) of the Small Business Act;(3) financial institutions that are potential program lenders

under section 7(a) of the Small Business Act; and(4) representative industry associations.

SEC. 233. COMPLETION OF PLANNING FOR LOAN MONITORING SYS-TEM.

(a) IN GENERAL.—The Administrator shall perform and com-plete the planning needed to serve as the basis for funding thedevelopment and implementation of the computerized loan monitor-ing system, including—

(1) fully defining the system requirement using on-line,automated capabilities to the extent feasible;

(2) identifying all data inputs and outputs necessary fortimely report generation;

(3) benchmark loan monitoring business processes and sys-tems against comparable industry processes and, if appropriate,simplify or redefine work processes based on these benchmarks;

(4) determine data quality standards and control systemsfor ensuring information accuracy;

(5) identify an acquisition strategy and work incrementsto completion;

(6) analyze the benefits and costs of alternatives and useto demonstrate the advantage of the final project;

(7) ensure that the proposed information system is consist-ent with the agency’s information architecture; and

15 USC 633 note.

Reports.


(8) estimate the cost to system completion, identifying theessential cost element.(b) REPORT.—

(1) IN GENERAL.—On the date that is 6 months after thedate of enactment of this Act, the Administrator shall submita report on the progress of the Administrator in carrying outsubsection (a) to—

(A) the Committees; and(B) the Comptroller General of the United States.

(2) EVALUATION.—Not later than 28 days after receipt ofthe report under paragraph (1)(B), the Comptroller Generalof the United States shall—

(A) prepare a written evaluation of the report forcompliance with subsection (a); and

(B) submit the evaluation to the Committees.(3) LIMITATION.—None of the funds provided for the pur-

chase of the loan monitoring system may be obligated orexpended until 45 days after the date on which the Committeesand the Comptroller General of the United States receive thereport under paragraph (1).

TITLE III—WOMEN’S BUSINESSENTERPRISES

SEC. 301. INTERAGENCY COMMITTEE PARTICIPATION.

Section 403 of the Women’s Business Ownership Act of 1988(15 U.S.C. 631 note) is amended—

(1) in subsection (a)(2)(A)—(A) by striking ‘‘and Amendments Act of 1994’’ and

inserting ‘‘Act of 1997’’; and(B) by inserting before the final period ‘‘, and who

shall report directly to the head of the agency on thestatus of the activities of the Interagency Committee’’;(2) in subsection (a)(2)(B), by inserting before the final

period the following: ‘‘and shall report directly to the Adminis-trator on the status of the activities on the Interagency Commit-tee and shall serve as the Interagency Committee Liaison tothe National Women’s Business Council established under sec-tion 405’’; and

(3) in subsection (b), by striking ‘‘and Amendments Actof 1994’’ and inserting ‘‘Act of 1997’’.

SEC. 302. REPORTS.


(1) by inserting ‘‘, through the Small Business Administra-tion,’’ after ‘‘transmit’’;

(2) by striking paragraph (1) and redesignating paragraphs(2) through (4) as paragraphs (1) through (3), respectively;and

(3) in paragraph (1), as redesignated, by inserting beforethe semicolon the following: ‘‘, including a verbatim reporton the status of progress of the Interagency Committee inmeeting its responsibilities and duties under section 402(a)’’.


SEC. 303. COUNCIL DUTIES.


(1) in subsection (c), by inserting after ‘‘Administrator’’the following: ‘‘(through the Assistant Administrator of theOffice of Women’s Business Ownership)’’; and

(2) in subsection (d)—(A) in paragraph (4), by striking ‘‘and’’ at the end;(B) in paragraph (5), by striking the period at the

end and inserting a semicolon; and(C) by adding at the end the following:

‘‘(6) not later than 90 days after the last day of eachfiscal year, submit to the President and to the Committeeon Small Business of the Senate and the Committee on SmallBusiness of the House of Representatives, a report containing—

‘‘(A) a detailed description of the activities of the coun-cil, including a status report on the Council’s progresstoward meeting its duties outlined in subsections (a) and(d) of section 406;

‘‘(B) the findings, conclusions, and recommendationsof the Council; and

‘‘(C) the Council’s recommendations for such legislationand administrative actions as the Council considers appro-priate to promote the development of small business con-cerns owned and controlled by women.

‘‘(e) FORM OF TRANSMITTAL.—The information included in eachreport under subsection (d) that is described in subparagraphs(A) through (C) of subsection (d)(6), shall be reported verbatim,together with any separate additional, concurring, or dissentingviews of the Administrator.’’.SEC. 304. COUNCIL MEMBERSHIP.


(1) in subsection (a), by striking ‘‘and Amendments Actof 1994’’ and inserting ‘‘Act of 1997’’;

(2) in subsection (b)—(A) by striking ‘‘and Amendments Act of 1994’’ and

inserting ‘‘Act of 1997’’;(B) by inserting after ‘‘the Administrator shall’’ the

following: ‘‘, after receiving the recommendations of theChairman and the Ranking Member of the Committeeson Small Business of the House of Representatives andthe Senate,’’;

(C) by striking ‘‘9’’ and inserting ‘‘14’’;(D) in paragraph (1), by striking ‘‘2’’ and inserting

‘‘4’’;(E) in paragraph (2), by striking ‘‘2’’ and inserting

‘‘4’’; and(F) in paragraph (3)—

(i) by striking ‘‘5’’ and inserting ‘‘6’’;(ii) by striking ‘‘national’’; and(iii) by inserting ‘‘, including representatives of

women’s business center sites’’ before the period atthe end;

(3) in subsection (c), by inserting ‘‘(including both urbanand rural areas)’’ after ‘‘geographic’’;

Reports.


(4) by striking subsection (d) and inserting the following:‘‘(d) TERMS.—Each member of the Council shall be appointed

for a term of 3 years, except that, of the initial members appointedto the Council—

‘‘(1) 2 members appointed under subsection (b)(1) shallbe appointed for a term of 1 year;

‘‘(2) 2 members appointed under subsection (b)(2) shallbe appointed for a term of 1 year; and

‘‘(3) each member appointed under subsection (b)(3) shallbe appointed for a term of 2 years.’’; and

(5) by striking subsection (f) and inserting the following:‘‘(f) VACANCIES.—

‘‘(1) IN GENERAL.—A vacancy on the Council shall be fillednot later than 30 days after the date on which the vacancyoccurs, in the manner in which the original appointment wasmade, and shall be subject to any conditions that applied tothe original appointment.

‘‘(2) UNEXPIRED TERM.—An individual chosen to fill avacancy shall be appointed for the unexpired term of the mem-ber replaced.’’.

SEC. 305. AUTHORIZATION OF APPROPRIATIONS.

Section 409 of the Women’s Business Ownership Act of 1988(15 U.S.C. 631 note) is amended to read as follows:

‘‘SEC. 411. AUTHORIZATION OF APPROPRIATIONS.

‘‘(a) IN GENERAL.—There is authorized to be appropriated tocarry out this title $600,000, for each of fiscal years 1998 through2000, of which $200,000 shall be available in each fiscal yearto carry out sections 409 and 410.

‘‘(b) BUDGET REVIEW.—No amount made available under thissection for any fiscal year may be obligated or expended by theCouncil before the date on which the Council reviews and approvesthe operating budget of the Council to carry out the responsibilitiesof the Council for that fiscal year.’’.

SEC. 306. NATIONAL WOMEN’S BUSINESS COUNCIL PROCUREMENTPROJECT.

The Women’s Business Ownership Act of 1988 (15 U.S.C. 631note) is amended by inserting after section 408 the following:

‘‘SEC. 409. NATIONAL WOMEN’S BUSINESS COUNCIL PROCUREMENTPROJECT.

‘‘(a) FEDERAL PROCUREMENT STUDY.—‘‘(1) IN GENERAL.—During the first fiscal year for which

amounts are made available to carry out this section, the Coun-cil shall conduct a study on the award of Federal prime con-tracts and subcontracts to women-owned businesses, whichstudy shall include—

‘‘(A) an analysis of data collected by Federal agencieson contract awards to women-owned businesses;

‘‘(B) a determination of the degree to which individualFederal agencies are in compliance with the 5 percentwomen-owned business procurement goal established bysection 15(g)(1) of the Small Business Act (15 U.S.C.644(g)(1));


‘‘(C) a determination of the types and amounts of Fed-eral contracts characteristically awarded to women-ownedbusinesses; and

‘‘(D) other relevant information relating to participationof women-owned businesses in Federal procurement.‘‘(2) SUBMISSION OF RESULTS.—Not later than 12 months

after initiating the study under paragraph (1), the Councilshall submit to the Committees on Small Business of the Houseof Representatives and the Senate, and to the President, theresults of the study conducted under paragraph (1).‘‘(b) BEST PRACTICES REPORT.—Not later than 18 months after

initiating the study under subsection (a)(1), the Council shall submitto the Committees on Small Business of the House of Representa-tives and the Senate, and to the President, a report, which shallinclude—

‘‘(1) an analysis of the most successful practices in attract-ing women-owned businesses as prime contractors and sub-contractors by—

‘‘(A) Federal agencies (as supported by findings fromthe study required under subsection (a)(1)) in Federalprocurement awards; and

‘‘(B) the private sector; and‘‘(2) recommendations for policy changes in Federal procure-

ment practices, including an increase in the Federal procure-ment goal for women-owned businesses, in order to maximizethe number of women-owned businesses performing Federalcontracts.‘‘(c) CONTRACT AUTHORITY.—In conducting any study or other

research under this section, the Council may contract with 1 ormore public or private entities.’’.

SEC. 307. STUDIES AND OTHER RESEARCH.

The Women’s Business Ownership Act of 1988 (15 U.S.C. 631note) is amended by inserting after section 409 (as added by section306 of this title) the following:

‘‘SEC. 410. STUDIES AND OTHER RESEARCH.

‘‘(a) IN GENERAL.—To the extent that it does not delay submis-sion of the report under section 409(b), the Council may also conductsuch studies and other research relating to the award of Federalprime contracts and subcontracts to women-owned businesses, orto issues relating to access to credit and investment capital bywomen entrepreneurs, as the Council determines to be appropriate.

‘‘(b) CONTRACT AUTHORITY.—In conducting any study or otherresearch under this section, the Council may contract with 1 ormore public or private entities.’’.

SEC. 308. WOMEN’S BUSINESS CENTERS.

(a) IN GENERAL.—Section 29 of the Small Business Act (15U.S.C. 656) is amended to read as follows:

‘‘SEC. 29. WOMEN’S BUSINESS CENTER PROGRAM.

‘‘(a) DEFINITIONS.—In this section—‘‘(1) the term ‘Assistant Administrator’ means the Assistant

Administrator of the Office of Women’s Business Ownershipestablished under subsection (g);


‘‘(2) the term ‘small business concern owned and controlledby women’, either startup or existing, includes any small busi-ness concern—

‘‘(A) that is not less than 51 percent owned by 1 ormore women; and

‘‘(B) the management and daily business operationsof which are controlled by 1 or more women; and‘‘(3) the term ‘women’s business center site’ means the

location of—‘‘(A) a women’s business center; or‘‘(B) 1 or more women’s business centers, established

in conjunction with another women’s business center inanother location within a State or region—

‘‘(i) that reach a distinct population that wouldotherwise not be served;

‘‘(ii) whose services are targeted to women; and‘‘(iii) whose scope, function, and activities are simi-

lar to those of the primary women’s business centeror centers in conjunction with which it was established.

‘‘(b) AUTHORITY.—The Administration may provide financialassistance to private organizations to conduct 5-year projects forthe benefit of small business concerns owned and controlled bywomen. The projects shall provide—

‘‘(1) financial assistance, including training and counselingin how to apply for and secure business credit and investmentcapital, preparing and presenting financial statements, andmanaging cash flow and other financial operations of a businessconcern;

‘‘(2) management assistance, including training and coun-seling in how to plan, organize, staff, direct, and control eachmajor activity and function of a small business concern; and

‘‘(3) marketing assistance, including training and counsel-ing in identifying and segmenting domestic and internationalmarket opportunities, preparing and executing marketingplans, developing pricing strategies, locating contract opportuni-ties, negotiating contracts, and utilizing varying public relationsand advertising techniques.‘‘(c) CONDITIONS OF PARTICIPATION.—

‘‘(1) NON-FEDERAL CONTRIBUTIONS.—As a condition ofreceiving financial assistance authorized by this section, therecipient organization shall agree to obtain, after its applicationhas been approved and notice of award has been issued, cashcontributions from non-Federal sources as follows:

‘‘(A) in the first and second years, 1 non-Federal dollarfor each 2 Federal dollars;

‘‘(B) in the third and fourth years, 1 non-Federal dollarfor each Federal dollar; and

‘‘(C) in the fifth year, 2 non-Federal dollars for eachFederal dollar.‘‘(2) FORM OF NON-FEDERAL CONTRIBUTIONS.—Not more

than one-half of the non-Federal sector matching assistancemay be in the form of in-kind contributions that are budgetline items only, including office equipment and office space.

‘‘(3) FORM OF FEDERAL CONTRIBUTIONS.—The financialassistance authorized pursuant to this section may be madeby grant, contract, or cooperative agreement and may containsuch provision, as necessary, to provide for payments in lump


sum or installments, and in advance or by way of reimburse-ment. The Administration may disburse up to 25 percent ofeach year’s Federal share awarded to a recipient organizationafter notice of the award has been issued and before the non-Federal sector matching funds are obtained.

‘‘(4) FAILURE TO OBTAIN NON-FEDERAL FUNDING.—If anyrecipient of assistance fails to obtain the required non-Federalcontribution during any project, it shall not be eligible there-after for advance disbursements pursuant to paragraph (3)during the remainder of that project, or for any other projectfor which it is or may be funded by the Administration, andprior to approving assistance to such organization for any otherprojects, the Administration shall specifically determinewhether the Administration believes that the recipient willbe able to obtain the requisite non-Federal funding and entera written finding setting forth the reasons for making suchdetermination.‘‘(d) CONTRACT AUTHORITY.—A women’s business center may

enter into a contract with a Federal department or agency toprovide specific assistance to women and other underserved smallbusiness concerns. Performance of such contract should not hinderthe women’s business centers in carrying out the terms of thegrant received by the women’s business centers from the Adminis-tration.

‘‘(e) SUBMISSION OF 5-YEAR PLAN.—Each applicant organizationinitially shall submit a 5-year plan to the Administration on pro-posed fundraising and training activities, and a recipient organiza-tion may receive financial assistance under this program for amaximum of 5 years per women’s business center site.

‘‘(f) CRITERIA.—The Administration shall evaluate and rankapplicants in accordance with predetermined selection criteria thatshall be stated in terms of relative importance. Such criteria andtheir relative importance shall be made publicly available andstated in each solicitation for applications made by the Administra-tion. The criteria shall include—

‘‘(1) the experience of the applicant in conducting programsor ongoing efforts designed to impart or upgrade the businessskills of women business owners or potential owners;

‘‘(2) the present ability of the applicant to commence aproject within a minimum amount of time;

‘‘(3) the ability of the applicant to provide training andservices to a representative number of women who are bothsocially and economically disadvantaged; and

‘‘(4) the location for the women’s business center site pro-posed by the applicant.‘‘(g) OFFICE OF WOMEN’S BUSINESS OWNERSHIP.—

‘‘(1) ESTABLISHMENT.—There is established within theAdministration an Office of Women’s Business Ownership,which shall be responsible for the administration of theAdministration’s programs for the development of women’sbusiness enterprises (as defined in section 408 of the Women’sBusiness Ownership Act of 1988 (15 U.S.C. 631 note)). TheOffice of Women’s Business Ownership shall be administeredby an Assistant Administrator, who shall be appointed by theAdministrator.

‘‘(2) ASSISTANT ADMINISTRATOR OF THE OFFICE OF WOMEN’SBUSINESS OWNERSHIP.—


‘‘(A) QUALIFICATION.—The position of AssistantAdministrator shall be a Senior Executive Service positionunder section 3132(a)(2) of title 5, United States Code.The Assistant Administrator shall serve as a noncareerappointee (as defined in section 3132(a)(7) of that title).

‘‘(B) RESPONSIBILITIES AND DUTIES.—‘‘(i) RESPONSIBILITIES.—The responsibilities of the

Assistant Administrator shall be to administer the pro-grams and services of the Office of Women’s BusinessOwnership established to assist women entrepreneursin the areas of—

‘‘(I) starting and operating a small business;‘‘(II) development of management and tech-

nical skills;‘‘(III) seeking Federal procurement opportuni-

ties; and‘‘(IV) increasing the opportunity for access to

capital.‘‘(ii) DUTIES.—The Assistant Administrator shall—

‘‘(I) administer and manage the Women’s Busi-ness Center program;

‘‘(II) recommend the annual administrativeand program budgets for the Office of Women’sBusiness Ownership (including the budget for theWomen’s Business Center program);

‘‘(III) establish appropriate funding levelstherefore;

‘‘(IV) review the annual budgets submitted byeach applicant for the Women’s Business Centerprogram;

‘‘(V) select applicants to participate in the pro-gram under this section;

‘‘(VI) implement this section;‘‘(VII) maintain a clearinghouse to provide for

the dissemination and exchange of informationbetween women’s business centers;

‘‘(VIII) serve as the vice chairperson of theInteragency Committee on Women’s BusinessEnterprise;

‘‘(IX) serve as liaison for the National Women’sBusiness Council; and

‘‘(X) advise the Administrator on appointmentsto the Women’s Business Council.

‘‘(C) CONSULTATION REQUIREMENTS.—In carrying outthe responsibilities and duties described in this paragraph,the Assistant Administrator shall confer with and seekthe advice of the Administration officials in areas servedby the women’s business centers.

‘‘(h) PROGRAM EXAMINATION.—‘‘(1) IN GENERAL.—Not later than 180 days after the date

of enactment of the Small Business Reauthorization Act of1997, the Administrator shall develop and implement an annualprogrammatic and financial examination of each women’s busi-ness center established pursuant to this section.

‘‘(2) EXTENSION OF CONTRACTS.—In extending or renewinga contract with a women’s business center, the Administrator


shall consider the results of the examination conducted underparagraph (1).‘‘(i) CONTRACT AUTHORITY.—The authority of the Administrator

to enter into contracts shall be in effect for each fiscal year onlyto the extent and in the amounts as are provided in advancein appropriations Acts. After the Administrator has entered intoa contract, either as a grant or a cooperative agreement, withany applicant under this section, it shall not suspend, terminate,or fail to renew or extend any such contract unless the Adminis-trator provides the applicant with written notification setting forththe reasons therefore and affords the applicant an opportunityfor a hearing, appeal, or other administrative proceeding underchapter 5 of title 5, United States Code.

‘‘(j) REPORT.—The Administrator shall prepare and submit anannual report to the Committees on Small Business of the Houseof Representatives and the Senate on the effectiveness of all projectsconducted under the authority of this section. Such report shallprovide information concerning—

‘‘(1) the number of individuals receiving assistance;‘‘(2) the number of startup business concerns formed;‘‘(3) the gross receipts of assisted concerns;‘‘(4) increases or decreases in profits of assisted concerns;

and‘‘(5) the employment increases or decreases of assisted con-

cerns.‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—

‘‘(1) IN GENERAL.—There is authorized to be appropriated$8,000,000 for each fiscal year to carry out the projects author-ized under this section, of which, for fiscal year 1998, notmore than 5 percent may be used for administrative expensesrelated to the program under this section.

‘‘(2) USE OF AMOUNTS.—Amounts made available underthis subsection for fiscal year 1999, and each fiscal year there-after, may only be used for grant awards and may not beused for costs incurred by the Administration in connectionwith the management and administration of the program underthis section.

‘‘(3) EXPEDITED ACQUISITION.—Notwithstanding any otherprovision of law, the Administrator, acting through the Assist-ant Administrator, may use such expedited acquisition methodsas the Administrator determines to be appropriate to carryout this section, except that the Administrator shall ensurethat all small business sources are provided a reasonable oppor-tunity to submit proposals.’’.(b) APPLICABILITY.—

(1) IN GENERAL.—Subject to paragraph (2), any organizationconducting a 3-year project under section 29 of the Small Busi-ness Act (15 U.S.C. 656) (as in effect on the day before theeffective date of this Act) on September 30, 1997, may requestan extension of the term of that project to a total term of5 years. If such an extension is made, the organization shallreceive financial assistance in accordance with section 29(c)of the Small Business Act (as amended by this section) subjectto procedures established by the Administrator, in coordinationwith the Assistant Administrator of the Office of Women’sBusiness Ownership established under section 29 of the SmallBusiness Act (15 U.S.C. 656) (as amended by this section).

15 USC 656 note.


(2) TERMS OF ASSISTANCE FOR CERTAIN ORGANIZATIONS.—Any organization operating in the third year of a 3-year projectunder section 29 of the Small Business Act (15 U.S.C. 656)(as in effect on the day before the effective date of this Act)on September 30, 1997, may request an extension of the termof that project to a total term of 5 years. If such an extensionis made, during the fourth and fifth years of the project, theorganization shall receive financial assistance in accordancewith section 29(c)(1)(C) of the Small Business Act (as amendedby this section) subject to procedures established by theAdministrator, in coordination with the Assistant Administratorof the Office of Women’s Business Ownership established undersection 29 of the Small Business Act (15 U.S.C. 656) (as amend-ed by this section).

TITLE IV—COMPETITIVENESS PRO-GRAM AND PROCUREMENT OPPORTU-NITIES

Subtitle A—Small BusinessCompetitiveness Program

SEC. 401. PROGRAM TERM.

Section 711(c) of the Small Business Competitiveness Dem-onstration Program Act of 1988 (15 U.S.C. 644 note) is amendedby striking ‘‘, and terminate on September 30, 1997’’.SEC. 402. MONITORING AGENCY PERFORMANCE.

Section 712(d)(1) of the Small Business Competitiveness Dem-onstration Program Act of 1988 (15 U.S.C. 644 note) is amendedto read as follows:

‘‘(1) Participating agencies shall monitor the attainmentof their small business participation goals on an annual basis.An annual review by each participating agency shall be com-pleted not later than January 31 of each year, based on thedata for the preceding fiscal year, from October 1 throughSeptember 30.’’.

SEC. 403. REPORTS TO CONGRESS.

Section 716(a) of the Small Business Competitiveness Dem-onstration Program Act of 1988 (15 U.S.C. 644 note) is amended—

(1) by striking ‘‘1996’’ and inserting ‘‘2000’’;(2) by striking ‘‘for Federal Procurement Policy’’ and insert-

ing ‘‘of the Small Business Administration’’; and(3) by striking ‘‘Government Operations’’ and inserting

‘‘Government Reform and Oversight’’.SEC. 404. SMALL BUSINESS PARTICIPATION IN DREDGING.

Section 722(a) of the Small Business Competitiveness Dem-onstration Program Act of 1988 (15 U.S.C. 644 note) is amendedby striking ‘‘and terminating on September 30, 1997’’.SEC. 405. TECHNICAL AMENDMENTS.

Section 717 of the Small Business Competitiveness Demonstra-tion Program Act of 1988 (15 U.S.C. 644 note) is amended—


(1) by inserting ‘‘or North American Industrial Classifica-tion Code’’ after ‘‘standard industrial classification code’’ eachplace it appears; and

(2) by inserting ‘‘or North American Industrial Classifica-tion Codes’’ after ‘‘standard industrial classification codes’’ eachplace it appears.

Subtitle B—Small Business ProcurementOpportunities Program

SEC. 411. CONTRACT BUNDLING.

Section 2 of the Small Business Act (15 U.S.C. 631) is amendedby adding at the end the following:

‘‘(j) CONTRACT BUNDLING.—In complying with the statementof congressional policy expressed in subsection (a), relating to foster-ing the participation of small business concerns in the contractingopportunities of the Government, each Federal agency, to the maxi-mum extent practicable, shall—

‘‘(1) comply with congressional intent to foster the participa-tion of small business concerns as prime contractors, sub-contractors, and suppliers;

‘‘(2) structure its contracting requirements to facilitate com-petition by and among small business concerns, taking allreasonable steps to eliminate obstacles to their participation;and

‘‘(3) avoid unnecessary and unjustified bundling of contractrequirements that precludes small business participation inprocurements as prime contractors.’’.

SEC. 412. DEFINITION OF CONTRACT BUNDLING.

Section 3 of the Small Business Act (15 U.S.C. 632) is amendedby adding at the end the following:

‘‘(o) DEFINITIONS OF BUNDLING OF CONTRACT REQUIREMENTSAND RELATED TERMS.—In this Act:

‘‘(1) BUNDLED CONTRACT.—The term ‘bundled contract’means a contract that is entered into to meet requirementsthat are consolidated in a bundling of contract requirements.

‘‘(2) BUNDLING OF CONTRACT REQUIREMENTS.—The term‘bundling of contract requirements’ means consolidating 2 ormore procurement requirements for goods or services previouslyprovided or performed under separate smaller contracts intoa solicitation of offers for a single contract that is likely tobe unsuitable for award to a small-business concern due to—

‘‘(A) the diversity, size, or specialized nature of theelements of the performance specified;

‘‘(B) the aggregate dollar value of the anticipatedaward;

‘‘(C) the geographical dispersion of the contractperformance sites; or

‘‘(D) any combination of the factors described in sub-paragraphs (A), (B), and (C).‘‘(3) SEPARATE SMALLER CONTRACT.—The term ‘separate

smaller contract’, with respect to a bundling of contract require-ments, means a contract that has been performed by 1 ormore small business concerns or was suitable for award to1 or more small business concerns.’’.


SEC. 413. ASSESSING PROPOSED CONTRACT BUNDLING.

(a) IN GENERAL.—Section 15 of the Small Business Act (15U.S.C. 644) is amended by inserting after subsection (d) the follow-ing:

‘‘(e) PROCUREMENT STRATEGIES; CONTRACT BUNDLING.—‘‘(1) IN GENERAL.—To the maximum extent practicable,

procurement strategies used by the various agencies havingcontracting authority shall facilitate the maximum participationof small business concerns as prime contractors, subcontractors,and suppliers.

‘‘(2) MARKET RESEARCH.—‘‘(A) IN GENERAL.—Before proceeding with an acquisi-

tion strategy that could lead to a contract containingconsolidated procurement requirements, the head of anagency shall conduct market research to determine whetherconsolidation of the requirements is necessary and justified.

‘‘(B) FACTORS.—For purposes of subparagraph (A),consolidation of the requirements may be determined asbeing necessary and justified if, as compared to the benefitsthat would be derived from contracting to meet thoserequirements if not consolidated, the Federal Governmentwould derive from the consolidation measurably substantialbenefits, including any combination of benefits that, incombination, are measurably substantial. Benefitsdescribed in the preceding sentence may include the follow-ing:

‘‘(i) Cost savings.‘‘(ii) Quality improvements.‘‘(iii) Reduction in acquisition cycle times.‘‘(iv) Better terms and conditions.‘‘(v) Any other benefits.

‘‘(C) REDUCTION OF COSTS NOT DETERMINATIVE.—Thereduction of administrative or personnel costs alone shallnot be a justification for bundling of contract requirementsunless the cost savings are expected to be substantial inrelation to the dollar value of the procurement require-ments to be consolidated.‘‘(3) STRATEGY SPECIFICATIONS.—If the head of a contracting

agency determines that a proposed procurement strategy fora procurement involves a substantial bundling of contractrequirements, the proposed procurement strategy shall—

‘‘(A) identify specifically the benefits anticipated to bederived from the bundling of contract requirements;

‘‘(B) set forth an assessment of the specific impedi-ments to participation by small business concerns as primecontractors that result from the bundling of contractrequirements and specify actions designed to maximizesmall business participation as subcontractors (includingsuppliers) at various tiers under the contract or contractsthat are awarded to meet the requirements; and

‘‘(C) include a specific determination that the antici-pated benefits of the proposed bundled contract justify itsuse.‘‘(4) CONTRACT TEAMING.—In the case of a solicitation of

offers for a bundled contract that is issued by the head ofan agency, a small-business concern may submit an offer thatprovides for use of a particular team of subcontractors for


the performance of the contract. The head of the agency shallevaluate the offer in the same manner as other offers, withdue consideration to the capabilities of all of the proposedsubcontractors. If a small business concern teams under thisparagraph, it shall not affect its status as a small businessconcern for any other purpose.’’.(b) ADMINISTRATION REVIEW.—Section 15(a) of the Small Busi-

ness Act (15 U.S.C. 644(a)) is amended in the third sentence—(1) by inserting ‘‘or the solicitation involves an unnecessary

or unjustified bundling of contract requirements, as determinedby the Administration,’’ after ‘‘discrete construction projects,’’;

(2) by striking ‘‘or (4)’’ and inserting ‘‘(4)’’; and(3) by inserting before the period at the end of the sentence

the following: ‘‘, or (5) why the agency has determined thatthe bundled contract (as defined in section 3(o)) is necessaryand justified’’.(c) RESPONSIBILITIES OF AGENCY SMALL BUSINESS ADVO-

CATES.—Section 15(k) of the Small Business Act (15 U.S.C. 644(k))is amended—

(1) by redesignating paragraphs (5) through (9) as para-graphs (6) through (10), respectively; and

(2) by inserting after paragraph (4) the following:‘‘(5) identify proposed solicitations that involve significant

bundling of contract requirements, and work with the agencyacquisition officials and the Administration to revise theprocurement strategies for such proposed solicitations whereappropriate to increase the probability of participation by smallbusinesses as prime contractors, or to facilitate small businessparticipation as subcontractors and suppliers, if a solicitationfor a bundled contract is to be issued;’’.

SEC. 414. REPORTING OF BUNDLED CONTRACT OPPORTUNITIES.

(a) DATA COLLECTION REQUIRED.—The Federal ProcurementData System described in section 6(d)(4)(A) of the Office of FederalProcurement Policy Act (41 U.S.C. 405(d)(4)(A)) shall be modifiedto collect data regarding bundling of contract requirements whenthe contracting officer anticipates that the resulting contract price,including all options, is expected to exceed $5,000,000. The datashall reflect a determination made by the contracting officer regard-ing whether a particular solicitation constitutes a contract bundling.

(b) DEFINITIONS.—In this section, the term ‘‘bundling of contractrequirements’’ has the meaning given that term in section 3(o)of the Small Business Act (15 U.S.C. 632(o)) (as added by section412 of this subtitle).

SEC. 415. EVALUATING SUBCONTRACT PARTICIPATION IN AWARDINGCONTRACTS.

Section 8(d)(4) of the Small Business Act (15 U.S.C. 637(d)(4))is amended by adding at the end the following:

‘‘(G) The following factors shall be designated by the Fed-eral agency as significant factors for purposes of evaluatingoffers for a bundled contract where the head of the agencydetermines that the contract offers a significant opportunityfor subcontracting:

‘‘(i) A factor that is based on the rate provided underthe subcontracting plan for small business participationin the performance of the contract.

41 USC 405 note.


‘‘(ii) For the evaluation of past performance of an offer-or, a factor that is based on the extent to which the offerorattained applicable goals for small business participationin the performance of contracts.’’.

SEC. 416. IMPROVED NOTICE OF SUBCONTRACTING OPPORTUNITIES.

(a) USE OF THE COMMERCE BUSINESS DAILY AUTHORIZED.—Section 8 of the Small Business Act (15 U.S.C. 637) is amendedby adding at the end the following:

‘‘(k) NOTICES OF SUBCONTRACTING OPPORTUNITIES.—‘‘(1) IN GENERAL.—Notices of subcontracting opportunities

may be submitted for publication in the Commerce BusinessDaily by—

‘‘(A) a business concern awarded a contract by anexecutive agency subject to subsection (e)(1)(C); and

‘‘(B) a business concern that is a subcontractor or sup-plier (at any tier) to such contractor having a subcontract-ing opportunity in excess of $10,000.‘‘(2) CONTENT OF NOTICE.—The notice of a subcontracting

opportunity shall include—‘‘(A) a description of the business opportunity that

is comparable to the description specified in paragraphs(1), (2), (3), and (4) of subsection (f); and

‘‘(B) the due date for receipt of offers.’’.(b) REGULATIONS REQUIRED.—The Federal Acquisition Regula-

tion shall be amended to provide uniform implementation of theamendments made by this section.

(c) CONFORMING AMENDMENT.—Section 8(e)(1)(C) of the SmallBusiness Act (15 U.S.C. 637(e)(1)(C)) is amended by striking‘‘$25,000’’ each place that term appears and inserting ‘‘$100,000’’.SEC. 417. DEADLINES FOR ISSUANCE OF REGULATIONS.

(a) PROPOSED REGULATIONS.—Proposed amendments to theFederal Acquisition Regulation or proposed Small BusinessAdministration regulations under this subtitle and the amendmentsmade by this subtitle shall be published not later than 120 daysafter the date of enactment of this Act for the purpose of obtainingpublic comment pursuant to section 22 of the Office of FederalProcurement Policy Act (41 U.S.C. 418b), or chapter 5 of title5, United States Code, as appropriate. The public shall be affordednot less than 60 days to submit comments.

(b) FINAL REGULATIONS.—Final regulations shall be publishednot later than 270 days after the date of enactment of this Act.The effective date for such final regulations shall be not less than30 days after the date of publication.

TITLE V—MISCELLANEOUS PROVISIONSSEC. 501. SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM.

(a) REQUIRED EXPENDITURES.—Section 9(n) of the Small Busi-ness Act (15 U.S.C. 638(n)) is amended by striking paragraph(1) and inserting the following:

‘‘(1) REQUIRED EXPENDITURE AMOUNTS.—With respect tofiscal years 1998, 1999, 2000, and 2001, each Federal agencythat has an extramural budget for research, or research anddevelopment, in excess of $1,000,000,000 for that fiscal year,is authorized to expend with small business concerns not less

Effective date.

Publication.15 USC 631 note.

15 USC 637 note.


than 0.15 percent of that extramural budget specifically inconnection with STTR programs that meet the requirementsof this section and any policy directives and regulations issuedunder this section.’’.(b) REPORTS AND OUTREACH.—

(1) IN GENERAL.—Section 9 of the Small Business Act (15U.S.C. 638) is amended—

(A) in subsection (o)—(i) by redesignating paragraphs (8) through (11)

as paragraphs (10) through (13), respectively; and(ii) by inserting after paragraph (7) the following:

‘‘(8) include, as part of its annual performance plan asrequired by subsections (a) and (b) of section 1115 of title31, United States Code, a section on its STTR program, andshall submit such section to the Committee on Small Businessof the Senate, and the Committee on Science and the Committeeon Small Business of the House of Representatives;

‘‘(9) collect such data from awardees as is necessary toassess STTR program outputs and outcomes;’’;

(B) in subsection (e)(4)(A), by striking ‘‘(ii)’’; and(C) by adding at the end the following:

‘‘(s) OUTREACH.—‘‘(1) DEFINITION OF ELIGIBLE STATE.—In this subsection,

the term ‘eligible State’ means a State—‘‘(A) if the total value of contracts awarded to the

State during fiscal year 1995 under this section was lessthan $5,000,000; and

‘‘(B) that certifies to the Administration described inparagraph (2) that the State will, upon receipt of assistanceunder this subsection, provide matching funds from non-Federal sources in an amount that is not less than 50percent of the amount provided under this subsection.‘‘(2) PROGRAM AUTHORITY.—Of amounts made available to

carry out this section for fiscal year 1998, 1999, 2000, or 2001the Administrator may expend with eligible States not morethan $2,000,000 in each such fiscal year in order to increasethe participation of small business concerns located in thoseStates in the programs under this section.

‘‘(3) AMOUNT OF ASSISTANCE.—The amount of assistanceprovided to an eligible State under this subsection in anyfiscal year—

‘‘(A) shall be equal to twice the total amount of match-ing funds from non-Federal sources provided by the State;and

‘‘(B) shall not exceed $100,000.‘‘(4) USE OF ASSISTANCE.—Assistance provided to an eligible

State under this subsection shall be used by the State, inconsultation with State and local departments and agencies,for programs and activities to increase the participation ofsmall business concerns located in the State in the programsunder this section, including—

‘‘(A) the establishment of quantifiable performancegoals, including goals relating to—

‘‘(i) the number of program awards under this sec-tion made to small business concerns in the State;and


‘‘(ii) the total amount of Federal research anddevelopment contracts awarded to small business con-cerns in the State;‘‘(B) the provision of competition outreach support to

small business concerns in the State that are involvedin research and development; and

‘‘(C) the development and dissemination of educationaland promotional information relating to the programsunder this section to small business concerns in the State.

‘‘(t) INCLUSION IN STRATEGIC PLANS.—Program informationrelating to the SBIR and STTR programs shall be included byeach Federal agency in any update or revision required of theFederal agency under section 306(b) of title 5, United States Code.’’.

(2) REPEAL.—Effective October 1, 2001, section 9(s) of theSmall Business Act (as added by paragraph (1) of this sub-section) is repealed.

SEC. 502. SMALL BUSINESS DEVELOPMENT CENTERS.

(a) IN GENERAL.—Section 21(a) of the Small Business Act (15U.S.C. 648(a)) is amended—

(1) in paragraph (1)—(A) by inserting ‘‘any women’s business center operat-

ing pursuant to section 29,’’ after ‘‘credit or finance corpora-tion,’’;

(B) by inserting ‘‘or a women’s business center operat-ing pursuant to section 29’’ after ‘‘other than an institutionof higher education’’; and

(C) by inserting ‘‘and women’s business centers operat-ing pursuant to section 29’’ after ‘‘utilize institutions ofhigher education’’;(2) in paragraph (3)—

(A) by striking ‘‘, but with’’ and all that follows through‘‘parties.’’ and inserting the following: ‘‘for the delivery ofprograms and services to the small business community.Such programs and services shall be jointly developed,negotiated, and agreed upon, with full participation of bothparties, pursuant to an executed cooperative agreementbetween the Small Business Development Center applicantand the Administration.’’; and

(B) by adding at the end the following:‘‘(C) On an annual basis, the Small Business Development

Center shall review and coordinate public and private partner-ships and cosponsorships with the Administration for the pur-pose of more efficiently leveraging available resources on aNational and a State basis.’’;

(3) in paragraph (4)(C)—(A) by striking clause (i) and inserting the following:‘‘(i) IN GENERAL.—

‘‘(I) GRANT AMOUNT.—Subject to subclauses (II)and (III), the amount of a grant received by a Stateunder this section shall be equal to the greater of$500,000, or the sum of—

‘‘(aa) the State’s pro rata share of the nationalprogram, based upon the population of the Stateas compared to the total population of the UnitedStates; and

Effective date.


‘‘(bb) $300,000 in fiscal year 1998, $400,000in fiscal year 1999, and $500,000 in each fiscalyear thereafter.‘‘(II) PRO RATA REDUCTIONS.—If the amount made

available to carry out this section for any fiscal yearis insufficient to carry out subclause (I)(bb), theAdministration shall make pro rata reductions in theamounts otherwise payable to States under subclause(I)(bb).

‘‘(III) MATCHING REQUIREMENT.—The amount of agrant received by a State under this section shall notexceed the amount of matching funds from sourcesother than the Federal Government provided by theState under subparagraph (A).’’; and(B) in clause (iii), by striking ‘‘(iii)’’ and all that follows

through ‘‘1997.’’ and inserting the following:‘‘(iii) NATIONAL PROGRAM.—There are authorized to be

appropriated to carry out the national program under thissection—

‘‘(I) $85,000,000 for fiscal year 1998;‘‘(II) $90,000,000 for fiscal year 1999; and‘‘(III) $95,000,000 for fiscal year 2000 and each

fiscal year thereafter.’’; and(4) in paragraph (6)—

(A) in subparagraph (A), by striking ‘‘and’’ at the end;(B) in subparagraph (B), by striking the comma at

the end and inserting ‘‘; and’’; and(C) inserting after subparagraph (B) the following:‘‘(C) with outreach, development, and enhancement of

minority-owned small business startups or expansions,HUBZone small business concerns, veteran-owned smallbusiness startups or expansions, and women-owned smallbusiness startups or expansions, in communities impactedby base closings or military or corporate downsizing, orin rural or underserved communities;’’.

(b) SBDC SERVICES.—Section 21(c) of the Small Business Act(15 U.S.C. 648(c)) is amended—

(1) in paragraph (3)—(A) in subparagraph (A), by striking ‘‘businesses;’’ and

inserting ‘‘businesses, including—‘‘(i) working with individuals to increase awareness

of basic credit practices and credit requirements;‘‘(ii) working with individuals to develop business

plans, financial packages, credit applications, and contractproposals;

‘‘(iii) working with the Administration to develop andprovide informational tools for use in working with individ-uals on pre-business startup planning, existing businessexpansion, and export planning; and

‘‘(iv) working with individuals referred by the localoffices of the Administration and Administration participat-ing lenders;’’;

(B) in each of subparagraphs (B), (C), (D), (E), (F),(G), (M), (N), (O), (Q), and (R) by moving each margin2 ems to the left; and

(C) in subparagraph (C), by inserting ‘‘and the Adminis-tration’’ after ‘‘Center’’;


(2) in paragraph (5)—(A) by moving the margin 2 ems to the right;(B) by striking ‘‘paragraph (a)(1)’’ and inserting ‘‘sub-

section (a)(1)’’;(C) by striking ‘‘which ever’’ and inserting ‘‘whichever’’;

and(D) by striking ‘‘last,,’’ and inserting ‘‘last,’’;

(3) by redesignating paragraphs (4) through (7) as para-graphs (5) through (8), respectively; and

(4) in paragraph (3), in the undesignated material followingsubparagraph (R), by striking ‘‘A small’’ and inserting the fol-lowing:‘‘(4) A small’’.(c) COMPETITIVE AWARDS.—Section 21(l) of the Small Business

Act (15 U.S.C. 648(l)) is amended by adding at the end the following:‘‘If any contract or cooperative agreement under this section withan entity that is covered by this section is not renewed or extended,any award of a successor contract or cooperative agreement underthis section to another entity shall be made on a competitive basis.’’.

(d) PROHIBITION ON CERTAIN FEES.—Section 21 of the SmallBusiness Act (15 U.S.C. 648) is amended by adding at the endthe following:

‘‘(m) PROHIBITION ON CERTAIN FEES.—A small business develop-ment center shall not impose or otherwise collect a fee or othercompensation in connection with the provision of counseling servicesunder this section.’’.

SEC. 503. PILOT PREFERRED SURETY BOND GUARANTEE PROGRAMEXTENSION.

Section 207 of the Small Business Administration Reauthoriza-tion and Amendment Act of 1988 (15 U.S.C. 694b note) is amendedby striking ‘‘September 30, 1997’’ and inserting ‘‘September 30,2000’’.

SEC. 504. EXTENSION OF COSPONSORSHIP AUTHORITY.

Section 401(a)(2) of the Small Business AdministrationReauthorization and Amendments Act of 1994 (15 U.S.C. 637 note)is amended by striking ‘‘September 30, 1997’’ and inserting ‘‘Septem-ber 30, 2000’’.

SEC. 505. ASSET SALES.

In connection with the Administration’s implementation of aprogram to sell to the private sector loans and other assets heldby the Administration, the Administration shall provide to theCommittees a copy of the draft and final plans describing thesale and the anticipated benefits resulting from such sale.

SEC. 506. SMALL BUSINESS EXPORT PROMOTION.

(a) IN GENERAL.—Section 21(c)(3) of the Small Business Act(15 U.S.C. 648(c)(3)) is amended—

(1) in subparagraph (Q), by striking ‘‘and’’ at the end;(2) in subparagraph (R), by striking the period at the

end and inserting ‘‘; and’’; and(3) by inserting after subparagraph (R) the following:‘‘(S) providing small business owners with access to a wide

variety of export-related information by establishing on-linecomputer linkages between small business development centers

15 USC 634 note.


and an international trade data information network with tiesto the Export Assistance Center program.’’.(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to carry out section 21(c)(3)(S) of the SmallBusiness Act (15 U.S.C. 648(c)(3)(S)), as added by this section,$1,500,000 for each fiscal years 1998 and 1999.

SEC. 507. DEFENSE LOAN AND TECHNICAL ASSISTANCE PROGRAM.

(a) DELTA PROGRAM AUTHORIZED.—(1) IN GENERAL.—The Administrator may administer the

Defense Loan and Technical Assistance program in accordancewith the authority and requirements of this section.

(2) EXPIRATION OF AUTHORITY.—The authority of theAdministrator to carry out the DELTA program under para-graph (1) shall terminate when the funds referred to in sub-section (g)(1) have been expended.

(3) DELTA PROGRAM DEFINED.—In this section, the terms‘‘Defense Loan and Technical Assistance program’’ and ‘‘DELTAprogram’’ mean the Defense Loan and Technical Assistanceprogram that has been established by a memorandum of under-standing entered into by the Administrator and the Secretaryof Defense on June 26, 1995.(b) ASSISTANCE.—

(1) AUTHORITY.—Under the DELTA program, the Adminis-trator may assist small business concerns that are economicallydependent on defense expenditures to acquire dual-use capabili-ties.

(2) FORMS OF ASSISTANCE.—Forms of assistance authorizedunder paragraph (1) are as follows:

(A) LOAN GUARANTEES.—Loan guarantees under theterms and conditions specified under this section and otherapplicable law.

(B) NONFINANCIAL ASSISTANCE.—Other forms of assist-ance that are not financial.

(c) ADMINISTRATION OF PROGRAM.—In the administration ofthe DELTA program under this section, the Administrator shall—

(1) process applications for DELTA program loan guaran-tees;

(2) guarantee repayment of the resulting loans in accord-ance with this section; and

(3) take such other actions as are necessary to administerthe program.(d) SELECTION AND ELIGIBILITY REQUIREMENTS FOR DELTA

LOAN GUARANTEES.—(1) IN GENERAL.—The selection criteria and eligibility

requirements set forth in this subsection shall be applied inthe selection of small business concerns to receive loan guaran-tees under the DELTA program.

(2) SELECTION CRITERIA.—The criteria used for the selectionof a small business concern to receive a loan guarantee underthis section are as follows:

(A) The selection criteria established under the memo-randum of understanding referred to in subsection (a)(3).

(B) The extent to which the loans to be guaranteedwould support the retention of defense workers whoseemployment would otherwise be permanently or tempo-rarily terminated as a result of reductions in expenditures

15 USC 636 note.


by the United States for defense, the termination or can-cellation of a defense contract, the failure to proceed withan approved major weapon system, the merger or consolida-tion of the operations of a defense contractor, or the closureor realignment of a military installation.

(C) The extent to which the loans to be guaranteedwould stimulate job creation and new economic activitiesin communities most adversely affected by reductions inexpenditures by the United States for defense, the termi-nation or cancellation of a defense contract, the failureto proceed with an approved major weapon system, themerger or consolidation of the operations of a defense con-tractor, or the closure or realignment of a military installa-tion.

(D) The extent to which the loans to be guaranteedwould be used to acquire (or permit the use of other fundsto acquire) capital equipment to modernize or expand thefacilities of the borrower to enable the borrower to remainin the national technology and industrial base availableto the Department of Defense.(3) ELIGIBILITY REQUIREMENTS.—To be eligible for a loan

guarantee under the DELTA program, a borrower must dem-onstrate to the satisfaction of the Administrator that, duringany 1 of the 5 preceding operating years of the borrower,not less than 25 percent of the value of the borrower’s saleswere derived from—

(A) contracts with the Department of Defense or thedefense-related activities of the Department of Energy; or

(B) subcontracts in support of defense-related primecontracts.

(e) MAXIMUM AMOUNT OF LOAN PRINCIPAL.—With respect toeach borrower, the maximum amount of loan principal for whichthe Administrator may provide a guarantee under this sectionduring a fiscal year may not exceed $1,250,000.

(f) LOAN GUARANTY RATE.—The maximum allowable guaranteepercentage for loans guaranteed under this section may not exceed80 percent.

(g) FUNDING.—(1) IN GENERAL.—The funds that have been made available

for loan guarantees under the DELTA program and have beentransferred from the Department of Defense to the Small Busi-ness Administration before the date of the enactment of thisAct shall be used for carrying out the DELTA program underthis section.

(2) CONTINUED AVAILABILITY OF EXISTING FUNDS.—Thefunds made available under the second proviso under the head-ing ‘‘RESEARCH, DEVELOPMENT, TEST AND EVALUATION,DEFENSE-WIDE’’ in Public Law 103–335 (108 Stat. 2613) shallbe available until expended—

(A) to cover the costs (as defined in section 502(5)of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)))of loan guarantees issued under this section; and

(B) to cover the reasonable costs of the administrationof the loan guarantees.


SEC. 508. VERY SMALL BUSINESS CONCERNS.

Section 304(i) of the Small Business Administration Reauthor-ization and Amendments Act of 1994 (15 U.S.C. 644 note) is amend-ed by striking ‘‘September 30, 1998’’ and inserting ‘‘September30, 2000’’.SEC. 509. TRADE ASSISTANCE PROGRAM FOR SMALL BUSINESS CON-

CERNS ADVERSELY AFFECTED BY NAFTA.

The Administrator shall coordinate Federal assistance in orderto provide counseling to small business concerns adversely affectedby the North American Free Trade Agreement.

TITLE VI—HUBZONE PROGRAM

SEC. 601. SHORT TITLE.

This title may be cited as the ‘‘HUBZone Act of 1997’’.SEC. 602. HISTORICALLY UNDERUTILIZED BUSINESS ZONES.

(a) DEFINITIONS.—Section 3 of the Small Business Act (15U.S.C. 632) (as amended by section 412 of this Act) is amendedby adding at the end the following:

‘‘(p) DEFINITIONS RELATING TO HUBZONES.—In this Act:‘‘(1) HISTORICALLY UNDERUTILIZED BUSINESS ZONE.—The

term ‘historically underutilized business zone’ means any arealocated within 1 or more—

‘‘(A) qualified census tracts;‘‘(B) qualified nonmetropolitan counties; or‘‘(C) lands within the external boundaries of an Indian

reservation.‘‘(2) HUBZONE.—The term ‘HUBZone’ means a historically

underutilized business zone.‘‘(3) HUBZONE SMALL BUSINESS CONCERN.—The term

‘HUBZone small business concern’ means a small business con-cern—

‘‘(A) that is owned and controlled by 1 or more persons,each of whom is a United States citizen; and

‘‘(B) the principal office of which is located in aHUBZone; or‘‘(4) QUALIFIED AREAS.—

‘‘(A) QUALIFIED CENSUS TRACT.—The term ‘qualifiedcensus tract’ has the meaning given that term in section42(d)(5)(C)(ii)(I) of the Internal Revenue Code of 1986.

‘‘(B) QUALIFIED NONMETROPOLITAN COUNTY.—The term‘qualified nonmetropolitan county’ means any county—

‘‘(i) that, based on the most recent data availablefrom the Bureau of the Census of the Departmentof Commerce—

‘‘(I) is not located in a metropolitan statisticalarea (as defined in section 143(k)(2)(B) of theInternal Revenue Code of 1986); and

‘‘(II) in which the median household incomeis less than 80 percent of the nonmetropolitanState median household income; or‘‘(ii) that, based on the most recent data available

from the Secretary of Labor, has an unemploymentrate that is not less than 140 percent of the statewide

15 USC 631 note.

HUBZone Act of1997.

15 USC 636 note.


average unemployment rate for the State in whichthe county is located.

‘‘(5) QUALIFIED HUBZONE SMALL BUSINESS CONCERN.—‘‘(A) IN GENERAL.—A HUBZone small business concern

is ‘qualified’, if—‘‘(i) the small business concern has certified in

writing to the Administrator (or the Administratorotherwise determines, based on information submittedto the Administrator by the small business concern,or based on certification procedures, which shall beestablished by the Administration by regulation) that—

‘‘(I) it is a HUBZone small business concern;‘‘(II) not less than 35 percent of the employees

of the small business concern reside in a HUBZone,and the small business concern will attempt tomaintain this employment percentage during theperformance of any contract awarded to the smallbusiness concern on the basis of a preference pro-vided under section 31(b); and

‘‘(III) with respect to any subcontract enteredinto by the small business concern pursuant toa contract awarded to the small business concernunder section 31, the small business concern willensure that—

‘‘(aa) in the case of a contract for services(except construction), not less than 50 percentof the cost of contract performance incurredfor personnel will be expended for its employ-ees or for employees of other HUBZone smallbusiness concerns; and

‘‘(bb) in the case of a contract for procure-ment of supplies (other than procurement froma regular dealer in such supplies), not lessthan 50 percent of the cost of manufacturingthe supplies (not including the cost of mate-rials) will be incurred in connection with theperformance of the contract in a HUBZoneby 1 or more HUBZone small business con-cerns; and

‘‘(ii) no certification made or information providedby the small business concern under clause (i) hasbeen, in accordance with the procedures establishedunder section 31(c)(1)—

‘‘(I) successfully challenged by an interestedparty; or

‘‘(II) otherwise determined by the Adminis-trator to be materially false.

‘‘(B) CHANGE IN PERCENTAGES.—The Administratormay utilize a percentage other than the percentage speci-fied in item (aa) or (bb) of subparagraph (A)(i)(III), if theAdministrator determines that such action is necessaryto reflect conventional industry practices among small busi-ness concerns that are below the numerical size standardfor businesses in that industry category.

‘‘(C) CONSTRUCTION AND OTHER CONTRACTS.—TheAdministrator shall promulgate final regulations imposing

Regulations.


requirements that are similar to those specified in sub-clauses (IV) and (V) of subparagraph (A)(i) on contractsfor general and specialty construction, and on contractsfor any other industry category that would not otherwisebe subject to those requirements. The percentage applicableto any such requirement shall be determined in accordancewith subparagraph (B).

‘‘(D) LIST OF QUALIFIED SMALL BUSINESS CONCERNS.—The Administrator shall establish and maintain a list ofqualified HUBZone small business concerns, which listshall, to the extent practicable—

‘‘(i) include the name, address, and type of businesswith respect to each such small business concern;

‘‘(ii) be updated by the Administrator not less thanannually; and

‘‘(iii) be provided upon request to any Federalagency or other entity.’’.

(b) FEDERAL CONTRACTING.—(1) IN GENERAL.—The Small Business Act (15 U.S.C. 631

et seq.) is amended—(A) by redesignating section 31 as section 32; and(B) by inserting after section 30 the following:

‘‘SEC. 31. HUBZONE PROGRAM.

‘‘(a) IN GENERAL.—There is established within the Administra-tion a program to be carried out by the Administrator to providefor Federal contracting assistance to qualified HUBZone small busi-ness concerns in accordance with this section.

‘‘(b) ELIGIBLE CONTRACTS.—‘‘(1) DEFINITIONS.—In this subsection—

‘‘(A) the term ‘contracting officer’ has the meaninggiven that term in section 27(f)(5) of the Office of FederalProcurement Policy Act (41 U.S.C. 423(f)(5)); and

‘‘(B) the term ‘full and open competition’ has the mean-ing given that term in section 4 of the Office of FederalProcurement Policy Act (41 U.S.C. 403).‘‘(2) AUTHORITY OF CONTRACTING OFFICER.—Notwithstand-

ing any other provision of law—‘‘(A) a contracting officer may award sole source con-

tracts under this section to any qualified HUBZone smallbusiness concern, if—

‘‘(i) the qualified HUBZone small business concernis determined to be a responsible contractor withrespect to performance of such contract opportunity,and the contracting officer does not have a reasonableexpectation that 2 or more qualified HUBZone smallbusiness concerns will submit offers for the contractingopportunity;

‘‘(ii) the anticipated award price of the contract(including options) will not exceed—

‘‘(I) $5,000,000, in the case of a contract oppor-tunity assigned a standard industrial classificationcode for manufacturing; or

‘‘(II) $3,000,000, in the case of all other con-tract opportunities; and

15 USC 657a.

15 USC 631 note.


‘‘(iii) in the estimation of the contracting officer,the contract award can be made at a fair and reason-able price;‘‘(B) a contract opportunity shall be awarded pursuant

to this section on the basis of competition restricted toqualified HUBZone small business concerns if the contract-ing officer has a reasonable expectation that not less than2 qualified HUBZone small business concerns will submitoffers and that the award can be made at a fair marketprice; and

‘‘(C) not later than 5 days from the date the Adminis-tration is notified of a procurement officer’s decision notto award a contract opportunity under this section to aqualified HUBZone small business concern, the Adminis-trator may notify the contracting officer of the intent toappeal the contracting officer’s decision, and within 15days of such date the Administrator may file a writtenrequest for reconsideration of the contracting officer’s deci-sion with the Secretary of the department or agency head.‘‘(3) PRICE EVALUATION PREFERENCE IN FULL AND OPEN

COMPETITIONS.—In any case in which a contract is to beawarded on the basis of full and open competition, the priceoffered by a qualified HUBZone small business concern shallbe deemed as being lower than the price offered by anotherofferor (other than another small business concern), if the priceoffered by the qualified HUBZone small business concern isnot more than 10 percent higher than the price offered bythe otherwise lowest, responsive, and responsible offeror.

‘‘(4) RELATIONSHIP TO OTHER CONTRACTING PREFERENCES.—A procurement may not be made from a source on the basisof a preference provided in paragraph (2) or (3), if the procure-ment would otherwise be made from a different source undersection 4124 or 4125 of title 18, United States Code, or theJavits-Wagner-O’Day Act (41 U.S.C. 46 et seq.).‘‘(c) ENFORCEMENT; PENALTIES.—

‘‘(1) VERIFICATION OF ELIGIBILITY.—In carrying out thissection, the Administrator shall establish procedures relatingto—

‘‘(A) the filing, investigation, and disposition by theAdministration of any challenge to the eligibility of a smallbusiness concern to receive assistance under this section(including a challenge, filed by an interested party, relatingto the veracity of a certification made or information pro-vided to the Administration by a small business concernunder section 3(p)(5)); and

‘‘(B) verification by the Administrator of the accuracyof any certification made or information provided to theAdministration by a small business concern under section3(p)(5).‘‘(2) EXAMINATIONS.—The procedures established under

paragraph (1) may provide for program examinations (includingrandom program examinations) by the Administrator of anysmall business concern making a certification or providinginformation to the Administrator under section 3(p)(5).

‘‘(3) PROVISION OF DATA.—Upon the request of the Adminis-trator, the Secretary of Labor, the Secretary of Housing andUrban Development, and the Secretary of the Interior (or the

Regulations.


Assistant Secretary for Indian Affairs), shall promptly provideto the Administrator such information as the Administratordetermines to be necessary to carry out this subsection.

‘‘(4) PENALTIES.—In addition to the penalties described insection 16(d), any small business concern that is determinedby the Administrator to have misrepresented the status ofthat concern as a ‘HUBZone small business concern’ for pur-poses of this section, shall be subject to—

‘‘(A) section 1001 of title 18, United States Code; and‘‘(B) sections 3729 through 3733 of title 31, United

States Code.’’.(2) INITIAL LIMITED APPLICABILITY.—During the period

beginning on the date of enactment of this Act and endingon September 30, 2000, section 31 of the Small Business Act(as added by paragraph (1) of this subsection) shall applyonly to procurements by—

(A) the Department of Defense;(B) the Department of Agriculture;(C) the Department of Health and Human Services;(D) the Department of Transportation;(E) the Department of Energy;(F) the Department of Housing and Urban Develop-

ment;(G) the Environmental Protection Agency;(H) the National Aeronautics and Space Administra-

tion;(I) the General Services Administration; and(J) the Department of Veterans Affairs.

SEC. 603. TECHNICAL AND CONFORMING AMENDMENTS TO THE SMALLBUSINESS ACT.

(a) PERFORMANCE OF CONTRACTS.—Section 8(d) of the SmallBusiness Act (15 U.S.C. 637(d)) is amended—

(1) in paragraph (1)—(A) in the first sentence, by striking ‘‘,, small business

concerns owned and controlled by socially and economicallydisadvantaged individuals’’ and inserting ‘‘, qualifiedHUBZone small business concerns, small business concernsowned and controlled by socially and economically dis-advantaged individuals’’; and

(B) in the second sentence, by inserting ‘‘qualifiedHUBZone small business concerns,’’ after ‘‘small businessconcerns,’’;(2) in paragraph (3)—

(A) by inserting ‘‘qualified HUBZone small businessconcerns,’’ after ‘‘small business concerns,’’ each place thatterm appears; and

(B) by adding at the end the following:‘‘(F) In this contract, the term ‘qualified HUBZone small

business concern’ has the meaning given that term in section3(p) of the Small Business Act.’’;

(3) in paragraph (4)(E), by striking ‘‘small business concernsand’’ and inserting ‘‘small business concerns, qualifiedHUBZone small business concerns, and’’;

(4) in paragraph (6), by inserting ‘‘qualified HUBZone smallbusiness concerns,’’ after ‘‘small business concerns,’’ each placethat term appears; and

15 USC 657anote.


(5) in paragraph (10), by inserting ‘‘qualified HUBZonesmall business concerns,’’ after ‘‘small business concerns,’’.(b) AWARDS OF CONTRACTS.—Section 15 of the Small Business

Act (15 U.S.C. 644) is amended—(1) in subsection (g)(1)—

(A) by inserting ‘‘qualified HUBZone small businessconcerns,’’ after ‘‘small business concerns,’’ each place thatterm appears;

(B) in the second sentence, by striking ‘‘20 percent’’and inserting ‘‘23 percent’’; and

(C) by inserting after the second sentence the following:‘‘The Governmentwide goal for participation by qualifiedHUBZone small business concerns shall be established atnot less than 1 percent of the total value of all primecontract awards for fiscal year 1999, not less than 1.5percent of the total value of all prime contract awardsfor fiscal year 2000, not less than 2 percent of the totalvalue of all prime contract awards for fiscal year 2001,not less than 2.5 percent of the total value of all primecontract awards for fiscal year 2002, and not less than3 percent of the total value of all prime contract awardsfor fiscal year 2003 and each fiscal year thereafter.’’;(2) in subsection (g)(2)—

(A) in the first sentence, by striking ‘‘,, by small busi-ness concerns owned and controlled by socially andeconomically disadvantaged individuals’’ and inserting‘‘, by qualified HUBZone small business concerns, by smallbusiness concerns owned and controlled by socially andeconomically disadvantaged individuals’’;

(B) in the second sentence, by inserting ‘‘qualifiedHUBZone small business concerns,’’ after ‘‘small businessconcerns,’’; and

(C) in the fourth sentence, by striking ‘‘by small busi-ness concerns owned and controlled by socially andeconomically disadvantaged individuals and participationby small business concerns owned and controlled bywomen’’ and inserting ‘‘by qualified HUBZone small busi-ness concerns, by small business concerns owned and con-trolled by socially and economically disadvantaged individ-uals, and by small business concerns owned and controlledby women’’; and(3) in subsection (h), by inserting ‘‘qualified HUBZone small

business concerns,’’ after ‘‘small business concerns,’’ each placethat term appears.(c) OFFENSES AND PENALTIES.—Section 16 of the Small Business

Act (15 U.S.C. 645) is amended—(1) in subsection (d)(1)—

(A) by inserting ‘‘, a ‘qualified HUBZone small businessconcern’,’’ after ‘‘ ‘small business concern’,’’; and

(B) in subparagraph (A), by striking ‘‘section 9 or 15’’and inserting ‘‘section 9, 15, or 31’’; and(2) in subsection (e), by inserting ‘‘, a ‘HUBZone small

business concern’,’’ after ‘‘ ‘small business concern’,’’.

SEC. 604. OTHER TECHNICAL AND CONFORMING AMENDMENTS.

(a) TITLE 10, UNITED STATES CODE.—Section 2323 of title 10,United States Code, is amended—


(1) in subsection (a)(1)(A), by inserting before the semicolonthe following: ‘‘, and qualified HUBZone small business con-cerns (as defined in section 3(p) of the Small Business Act)’’;and

(2) in subsection (f)(1), by inserting ‘‘or as a qualifiedHUBZone small business concern (as defined in section 3(p)of the Small Business Act)’’ after ‘‘(as described in subsection(a))’’.(b) FEDERAL HOME LOAN BANK ACT.—Section 21A(b)(13) of

the Federal Home Loan Bank Act (12 U.S.C. 1441a(b)(13)) is amend-ed—

(1) by striking ‘‘concerns and small’’ and inserting ‘‘con-cerns, small’’; and

(2) by inserting ‘‘, and qualified HUBZone small businessconcerns (as defined in section 3(p) of the Small BusinessAct)’’ after ‘‘disadvantaged individuals’’.(c) SMALL BUSINESS ECONOMIC POLICY ACT OF 1980.—Section

303(e) of the Small Business Economic Policy Act of 1980 (15U.S.C. 631b(e)) is amended—

(1) in paragraph (1), by striking ‘‘and’’ at the end;(2) in paragraph (2), by striking the period at the end

and inserting ‘‘; and’’; and(3) by adding at the end the following:‘‘(3) qualified HUBZone small business concern (as defined

in section 3(p) of the Small Business Act).’’.(d) SMALL BUSINESS INVESTMENT ACT OF 1958.—Section

411(c)(3)(B) of the Small Business Investment Act of 1958 (15U.S.C. 694b(c)(3)(B)) is amended by inserting before the semicolonthe following: ‘‘, or to a qualified HUBZone small business concern(as defined in section 3(p) of the Small Business Act)’’.

(e) TITLE 31, UNITED STATES CODE.—(1) CONTRACTS FOR COLLECTION SERVICES.—Section 3718(b)

of title 31, United States Code, is amended—(A) in paragraph (1)(B), by inserting ‘‘and law firms

that are qualified HUBZone small business concerns (asdefined in section 3(p) of the Small Business Act)’’ after‘‘disadvantaged individuals’’; and

(B) in paragraph (3)—(i) in the first sentence, by inserting before the

period ‘‘and law firms that are qualified HUBZonesmall business concerns’’;

(ii) in subparagraph (A), by striking ‘‘and’’ at theend;

(iii) in subparagraph (B), by striking the periodat the end and inserting ‘‘; and’’; and

(iv) by adding at the end the following:‘‘(C) the term ‘qualified HUBZone small business con-

cern’ has the meaning given that term in section 3(p)of the Small Business Act.’’.(2) PAYMENTS TO LOCAL GOVERNMENTS.—Section 6701(f)

of title 31, United States Code, is amended—(A) in paragraph (1)—

(i) in subparagraph (A), by striking ‘‘and’’ at theend;

(ii) in subparagraph (B), by striking the periodat the end and inserting ‘‘; and’’; and

(iii) by adding at the end the following:


‘‘(C) qualified HUBZone small business concerns.’’; and(B) in paragraph (3)—

(i) in subparagraph (A), by striking ‘‘and’’ at theend;

(ii) in subparagraph (B), by striking the periodat the end and inserting ‘‘; and’’; and

(iii) by adding at the end the following:‘‘(C) the term ‘qualified HUBZone small business con-

cern’ has the meaning given that term in section 3(p)of the Small Business Act (15 U.S.C. 632(o)).’’.(3) REGULATIONS.—Section 7505(c) of title 31, United States

Code, is amended by striking ‘‘small business concerns and’’and inserting ‘‘small business concerns, qualified HUBZonesmall business concerns, and’’.(f) OFFICE OF FEDERAL PROCUREMENT POLICY ACT.—

(1) ENUMERATION OF INCLUDED FUNCTIONS.—Section 6(d)of the Office of Federal Procurement Policy Act (41 U.S.C.405(d)) is amended—

(A) in paragraph (11), by inserting ‘‘qualified HUBZonesmall business concerns (as defined in section 3(p) of theSmall Business Act),’’ after ‘‘small businesses,’’; and

(B) in paragraph (12), by inserting ‘‘qualified HUBZonesmall business concerns (as defined in section 3(p) of theSmall Business Act (15 U.S.C. 632(o)),’’ after ‘‘smallbusinesses,’’.(2) PROCUREMENT DATA.—Section 502 of the Women’s Busi-

ness Ownership Act of 1988 (41 U.S.C. 417a) is amended—(A) in subsection (a)—

(i) in the first sentence, by inserting ‘‘the numberof qualified HUBZone small business concerns,’’ after‘‘Procurement Policy’’; and

(ii) by inserting a comma after ‘‘women’’; and(B) in subsection (b), by inserting after ‘‘section 204

of this Act’’ the following: ‘‘, and the term ‘qualifiedHUBZone small business concern’ has the meaning giventhat term in section 3(p) of the Small Business Act (15U.S.C. 632(o)).’’.

(g) ENERGY POLICY ACT OF 1992.—Section 3021 of the EnergyPolicy Act of 1992 (42 U.S.C. 13556) is amended—

(1) in subsection (a)—(A) in paragraph (2), by striking ‘‘or’’;(B) in paragraph (3), by striking the period and insert-

ing ‘‘; or’’; and(C) by adding at the end the following:

‘‘(4) qualified HUBZone small business concerns.’’; and(2) in subsection (b), by adding at the end the following:‘‘(3) The term ‘qualified HUBZone small business concern’

has the meaning given that term in section 3(p) of the SmallBusiness Act (15 U.S.C. 632(o)).’’.(h) TITLE 49, UNITED STATES CODE.—

(1) PROJECT GRANT APPLICATION APPROVAL CONDITIONEDON ASSURANCES ABOUT AIRPORT OPERATION.—Section 47107(e)of title 49, United States Code, is amended—

(A) in paragraph (1), by inserting before the period‘‘or qualified HUBZone small business concerns (as definedin section 3(p) of the Small Business Act)’’;


(B) in paragraph (4)(B), by inserting before the period‘‘or as a qualified HUBZone small business concern (asdefined in section 3(p) of the Small Business Act)’’; and

(C) in paragraph (6), by inserting ‘‘or a qualifiedHUBZone small business concern (as defined in section3(p) of the Small Business Act)’’ after ‘‘disadvantagedindividual’’.(2) MINORITY AND DISADVANTAGED BUSINESS PARTICIPA-

TION.—Section 47113 of title 49, United States Code, is amend-ed—

(A) in subsection (a)—(i) in paragraph (1), by striking the period at the

end and inserting a semicolon;(ii) in paragraph (2), by striking the period at

the end and inserting ‘‘; and’’; and(iii) by adding at the end the following:

‘‘(3) the term ‘qualified HUBZone small business concern’has the meaning given that term in section 3(p) of the SmallBusiness Act (15 U.S.C. 632(o)).’’; and

(B) in subsection (b), by inserting before the period‘‘or qualified HUBZone small business concerns’’.

SEC. 605. REGULATIONS.

(a) IN GENERAL.—Not later than 180 days after the date ofenactment of this Act, the Administrator shall publish in the Fed-eral Register such final regulations as may be necessary to carryout this title and the amendments made by this title.

(b) FEDERAL ACQUISITION REGULATION.—Not later than 180days after the date on which final regulations are published undersubsection (a), the Federal Acquisition Regulatory Council shallamend the Federal Acquisition Regulation in order to ensureconsistency between the Federal Acquisition Regulation, this titleand the amendments made by this title, and the final regulationspublished under subsection (a).

SEC. 606. REPORT.

Not later than March 1, 2002, the Administrator shall submitto the Committees a report on the implementation of the HUBZoneprogram established under section 31 of the Small Business Act(as added by section 602(b) of this title) and the degree to whichthe HUBZone program has resulted in increased employmentopportunities and an increased level of investment in HUBZones(as defined in section 3(p) of the Small Business Act (15 U.S.C.632(p)), as added by section 602(a) of this title).

SEC. 607. AUTHORIZATION OF APPROPRIATIONS.

Section 20 of the Small Business Act (15 U.S.C. 631 note)(as amended by section 101 of this Act) is amended—

(1) in subsection (c), by adding at the end the following:‘‘(3) HUBZONE PROGRAM.—There are authorized to be

appropriated to the Administration to carry out the programunder section 31, $5,000,000 for fiscal year 1998.’’;

(2) in subsection (d), by adding at the end the following:‘‘(3) HUBZONE PROGRAM.—There are authorized to be

appropriated to the Administration to carry out the programunder section 31, $5,000,000 for fiscal year 1999.’’; and

(3) in subsection (e), by adding at the end the following:

15 USC 657anote.

Federal Register,publication.15 USC 632 note.


‘‘(3) HUBZONE PROGRAM.—There are authorized to beappropriated to the Administration to carry out the programunder section 31, $5,000,000 for fiscal year 2000.’’.

TITLE VII—SERVICE DISABLEDVETERANS

SEC. 701. PURPOSES.

The purposes of this title are—(1) to foster enhanced entrepreneurship among eligible vet-

erans by providing increased opportunities;(2) to vigorously promote the legitimate interests of small

business concerns owned and controlled by eligible veterans;and

(3) to ensure that those concerns receive fair considerationin purchases made by the Federal Government.

SEC. 702. DEFINITIONS.

In this title:(1) ELIGIBLE VETERAN.—The term ‘‘eligible veteran’’ means

a disabled veteran (as defined in section 4211(3) of title 38,United States Code).

(2) SMALL BUSINESS CONCERN OWNED AND CONTROLLED BYELIGIBLE VETERANS.—The term ‘‘small business concern ownedand controlled by eligible veterans’’ means a small businessconcern (as defined in section 3 of the Small Business Act)—

(A) that is at least 51 percent owned by 1 or moreeligible veterans, or in the case of a publicly owned busi-ness, at least 51 percent of the stock of which is ownedby 1 or more eligible veterans; and

(B) whose management and daily business operationsare controlled by eligible veterans.

SEC. 703. REPORT BY SMALL BUSINESS ADMINISTRATION.

(a) STUDY AND REPORT.—(1) IN GENERAL.—Not later than 9 months after the date

of enactment of this Act, the Administrator shall conduct acomprehensive study and submit to the Committees a finalreport containing findings and recommendations of theAdministrator on—

(A) the needs of small business concerns owned andcontrolled by eligible veterans;

(B) the availability and utilization of Administrationprograms by small business concerns owned and controlledby eligible veterans;

(C) the percentage, and dollar value, of Federal con-tracts awarded to small business concerns owned and con-trolled by eligible veterans in the preceding 5 fiscal years;and

(D) methods to improve Administration and otheragency programs to serve the needs of small business con-cerns owned and controlled by eligible veterans.

(2) CONTENTS.—The report under paragraph (1) shall includerecommendations to Congress concerning the need for legislationand recommendations to the Office of Management and Budget,

15 USC 631 note.

15 USC 631 note.

15 USC 631 note.


relevant offices within the Administration, and the Departmentof Veterans Affairs.

(b) CONDUCT OF STUDY.—In carrying out subsection (a), theAdministrator—

(1) may conduct surveys of small business concerns ownedand controlled by eligible veterans and service disabled veter-ans, including those who have sought financial assistance orother services from the Administration;

(2) shall consult with the appropriate committees of Con-gress, relevant groups and organizations in the nonprofit sector,and Federal or State government agencies; and

(3) shall have access to any information within other Fed-eral agencies that pertains to such veterans and their smallbusinesses, unless such access is specifically prohibited by law.

SEC. 704. INFORMATION COLLECTION.

After the date of issuance of the report required by section703(a), the Secretary of Veterans Affairs shall, in consultation withthe Assistant Secretary for Veterans’ Employment and Trainingand the Administrator, engage in efforts each fiscal year to identifysmall business concerns owned and controlled by eligible veteransin the United States. The Secretary shall inform each small businessconcern identified under this section that information on Federalprocurement is available from the Administrator.SEC. 705. STATE OF SMALL BUSINESS REPORT.

Section 303(b) of the Small Business Economic Policy Act of1980 (15 U.S.C. 631b(b)) is amended by striking ‘‘and female-ownedbusinesses’’ and inserting ‘‘, female-owned, and veteran-ownedbusinesses’’.SEC. 706. LOANS TO VETERANS.

Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) isamended by inserting after paragraph (7) the following:

‘‘(8) The Administration may make loans under this sub-section to small business concerns owned and controlled bydisabled veterans (as defined in section 4211(3) of title 38,United States Code).’’.

SEC. 707. ENTREPRENEURIAL TRAINING, COUNSELING, AND MANAGE-MENT ASSISTANCE.

The Administrator shall take such actions as may be necessaryto ensure that small business concerns owned and controlled byeligible veterans have access to programs established under theSmall Business Act that provide entrepreneurial training, businessdevelopment assistance, counseling, and management assistanceto small business concerns, including, among others, the SmallBusiness Development Center program and the Service Corps ofRetired Executives (SCORE) program.SEC. 708. GRANTS FOR ELIGIBLE VETERANS’ OUTREACH PROGRAMS.

Section 8(b) of the Small Business Act (15 U.S.C. 637(b)) isamended—

(1) in paragraph (15), by striking ‘‘and’’ at the end;(2) in the first paragraph designated as paragraph (16),

by striking the period at the end and inserting ‘‘; and’’; and(3) by striking the second paragraph designated as para-

graph (16) and inserting the following:

15 USC 631 note.

15 USC 631 note.


LEGISLATIVE HISTORY—S. 1139 (H.R. 2261):

HOUSE REPORTS: No. 105–246 accompanying H.R. 2261 (Comm. on Small Busi-ness).

SENATE REPORTS: No. 105–62 (Comm. on Small Business).CONGRESSIONAL RECORD, Vol. 143 (1997):

Sept. 9, considered and passed Senate.Sept. 29, considered and passed House, amended, in lieu of H.R. 2261.Oct. 31, Senate concurred in House amendment with an amendment.Nov. 9, House concurred in Senate amendment.

Æ

‘‘(17) to make grants to, and enter into contracts andcooperative agreements with, educational institutions, privatebusinesses, veterans’ nonprofit community-based organizations,and Federal, State, and local departments and agencies forthe establishment and implementation of outreach programsfor disabled veterans (as defined in section 4211(3) of title38, United States Code).’’.

SEC. 709. OUTREACH FOR ELIGIBLE VETERANS.

The Administrator, the Secretary of Veterans Affairs, and theAssistant Secretary of Labor for Veterans’ Employment and Train-ing, shall develop and implement a program of comprehensive out-reach to assist eligible veterans, which program shall includebusiness training and management assistance, employment andrelocation counseling, and dissemination of information on veterans’benefits and veterans’ entitlements.

Approved December 2, 1997.

15 USC 631 note.

small business reauthorization act of … business reauthorization act of 1997. dec. 2, 1997 [s....

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